South Korea has proposed rules requiring firms handling cross-border crypto transfers to register and report transactions from December 2026.
South Korea’s Ministry of Finance and Economy has published draft enforcement rules that will bring cross-border virtual asset transfers, including those involving exchanges and private wallets, under a formal monitoring system. The rules are set to take effect on 3 December 2026. They follow amendments to the Foreign Exchange Transactions Act, passed by the National Assembly in May 2026 and promulgated in June 2026, which created a new category of registered virtual asset transfer businesses. The public comment period on the draft ran until 26 October 2026.
Registration and reporting requirements
According to an analysis by law firm Bae, Kim & Lee, the draft covers transfers between domestic and foreign virtual asset service providers, as well as transfers between exchanges and private, unhosted wallets, which authorities consider capable of producing similar cross-border effects. Qualifying operators must register with the finance ministry after meeting existing virtual asset reporting obligations, connect their systems to the Bank of Korea’s foreign exchange information network, and keep records of relevant transfers.
Registration requires suitable IT systems and at least two qualified employees at each office, with two years of foreign exchange experience or government-approved training, but no separate minimum capital requirement. Exchanges such as Upbit and Bithumb could fall within the rules where their activities meet the definition, and the scope may also cover custody, brokerage, and related transfer services, depending on how individual firms operate.
Supervision and enforcement
Registered operators will submit transfer data to the Bank of Korea’s foreign exchange information system, which may be shared with the National Tax Service, Korea Customs Service, Financial Supervisory Service, and Korea Financial Intelligence Unit. The Financial Services Commission will receive delegated authority over certain supervisory measures and sanctions, while the Financial Supervisory Service will carry out inspections.
According to the ministry, the reporting system will help authorities identify unauthorised foreign exchange transactions and attempts to avoid existing controls. The draft introduces stronger sanctions for money exchange businesses involved in illegal remittances, voice phishing, or unauthorised trade payments, including registration cancellation after a first qualifying violation. The draft must still pass regulatory and legislative reviews and Cabinet consideration, while certain existing remittance and money exchange businesses will have until 30 June 2027 to comply.
