South Korea Expands Crypto Travel Rule to Smaller Transactions and Enhances Ownership Screening

South Korea’s Financial Services Commission (FSC) has unveiled stringent regulatory measures aimed at fortifying oversight of the virtual asset sector. The expanded ‘Travel Rule’ will now encompass smaller cryptocurrency transactions, previously exempt from such scrutiny, ensuring comprehensive monitoring of fund flows to deter money laundering and illicit financial activities. Additionally, the FSC is implementing stricter ownership controls by prohibiting individuals with serious criminal records from holding significant stakes in virtual asset service providers. This initiative underscores the government’s commitment to enhancing market integrity and aligning with global anti-money laundering standards. The regulatory overhaul reflects ongoing efforts to balance innovation in the digital asset space with robust consumer protection mechanisms, positioning South Korea as a leader in crypto governance. Industry stakeholders are advised to prepare for compliance adjustments as these rules take effect, potentially influencing operational frameworks across exchanges and related businesses.