South Korea Plans Comprehensive Crypto Regulations for 2025

South Korea is moving forward with plans to enhance its cryptocurrency regulations, aiming to implement the next phase of its framework by late 2025.

This effort, led by the Financial Services Commission (FSC), seeks to strengthen oversight, protect investors, and align the country’s policies with global standards in the rapidly evolving crypto space.

The initial regulatory measures, introduced in July 2024, focused heavily on investor protection. Among the key requirements was a mandate for crypto exchanges to store at least 80% of user funds in cold wallets, ensuring these assets were safeguarded from potential breaches. Building on this foundation, the second phase of regulations is set to adopt a broader approach, addressing market operations, user protections, and service provider practices.

FSC Vice Chairman Kim So-young emphasized the importance of staying in step with international regulatory developments.

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The new framework aims to enhance transparency in the listing of digital assets, introduce disclosure requirements comparable to those in traditional finance, and implement stricter oversight of stablecoins to ensure reserve adequacy and user redemption rights. These measures are designed to provide a secure environment for market participants while encouraging responsible innovation.

By pursuing this comprehensive approach, South Korea hopes to establish a regulatory landscape that balances investor security with the growth potential of the digital asset industry. This initiative reflects the country’s commitment to fostering a sustainable and trustworthy crypto market.

Alexander Stefanov