South Korean Regulators Plan to Deepen Real-Name Registration in Crypto Space, Expanding Travel Rule Oversight to Small Transactions

The South Korean financial regulatory authorities have recently initiated an important policy adjustment plan. According to the latest news, the Korea Financial Intelligence Unit has convened the first meeting of the "Specific Financial Transaction Information Reporting Act" revision team. This move signifies an upgrade in the regulation of Virtual Asset Service Providers (VASPs).

**Significant Expansion of Regulatory Scope, Small Transactions First Included in Travel Rule**

The most notable development is the expansion of the regulatory scope. Previously, the so-called "real-name registration" for the crypto industry, known as the Travel Rule, applied only to transactions exceeding 1 million Korean won. The new policy will extend this requirement to include small transactions. This means that Korean trading platforms will need to implement customer identity verification and information transfer mechanisms for a broader range of transaction sizes in the future.

**Establishing a Robust Regulatory System and Anti-Money Laundering Measures**

In addition to expanding the coverage of the Travel Rule, Korean authorities also plan to focus on:

- **Strengthening VASP Regulatory Framework**: Refining regulatory standards to establish a more systematic management system for virtual asset service providers
- **Advancing Stablecoin Regulation**: Developing clear regulatory rules and market entry standards for stablecoins
- **Improving Anti-Money Laundering Mechanisms**: Implementing more stringent AML measures to prevent financial risks

**Industry Impact and Outlook**

These series of adjustments reflect the increasing importance placed by Korean regulators on the virtual asset market. The expansion of the Travel Rule will raise compliance costs for platforms but will also help enhance the overall market’s regulation and transparency. For exchanges operating in Korea, adapting to the new regulatory requirements is an urgent task.