South Korea Strengthens Cryptocurrency Regulation: Expands Major Shareholder Review Scope, Abolishes Travel Rule Million-Dollar Threshold

August 11th - The South Korean Cabinet approved amendments to the Enforcement Decree of the Specific Financial Information Act, expanding the coverage of the Travel Rule for cryptocurrency assets from transactions of 1 million KRW or more to all transactions to prevent regulatory arbitrage through transaction splitting.

The new regulations also tighten VASP admission requirements, expand the scope of major shareholder reviews, and introduce new financial requirements such as a debt-to-equity ratio not exceeding 200%. Transfers to overseas CEXs and individual wallets will be subject to differentiated risk-based management, where high-risk transactions may be prohibited. The implementation of regulations related to the Travel Rule will occur six months after the publication of the amendment.