South Korea to Extend Crypto Travel Rule to Sub-$700 Transactions in AML Clampdown

South Korea is making ready considered one of its most aggressive crackdowns on cryptocurrency-related monetary crime by increasing its journey rule necessities.

The new threshold covers transactions beneath 1 million gained ($680), which till now allowed customers to bypass identification checks by breaking transfers into smaller quantities, in accordance to Yonhap News.

South Korea’s FSC Chief Vows Crypto AML Push With Expanded Travel Rule

Financial Services Commission (FSC) Chairman Lee Eok-won confirmed the plan Wednesday throughout a briefing to the National Assembly’s Legislation and Judiciary Committee, saying authorities would tighten oversight on crypto rails more and more used for cash laundering and tax evasion.

“We will crack down on crypto cash laundering […] increasing the Travel Rule to transactions beneath 1 million gained,” Lee stated.

Currently, South Korea’s journey rule largely applies to higher-value transfers, requiring exchanges to accumulate and change figuring out details about senders and recipients.

The new proposal would eradicate that loophole, forcing crypto platforms to apply the identical disclosure requirements to smaller transactions that have been usually used to evade reporting.

Once the change is carried out, exchanges working in South Korea shall be required to collect full identification knowledge on crypto customers even for low-value trades and transfers.

Regulators consider this can considerably cut back the usage of digital belongings for abroad remittances tied to unlawful actions and unreported earnings.

BREAKING: South Korea now suspects North Korea’s Lazarus Group is behind the current hack on crypto change Upbit through Yonhap.

Lazarus has been linked to virtually each main exploit in the previous few years:
• the WazirX assault
• the Bybit breach
• a number of bridge and… pic.twitter.com/l3CQFnXlp7

— Rananjay Singh (@At the momentCryptoRj) November 28, 2025

The FSC additionally plans to introduce harder restrictions on so-called “high-risk” offshore exchanges that facilitate transactions for Korean customers with out being licensed domestically.

According to the regulator, these platforms shall be blocked outright if they’re deemed to pose heightened dangers of fraud or cash laundering.

In addition, crypto exchanges will face extra intense opinions of their monetary stability.

The authorities plans to widen the standards for Virtual Asset Service Provider (VASP) registration, evaluating whether or not platforms have sufficient reserves, inner controls and compliance programs in place.

New guidelines can even bar people with prior convictions for tax crimes or drug offenses from turning into main shareholders in licensed crypto corporations, a transfer geared toward stopping prison networks from gaining affect over regulated platforms.

South Korea to Grant FIU Pre-Emptive Freezing Powers

The Financial Intelligence Unit (FIU) can even introduce pre-emptive account-freezing powers in severe circumstances, permitting investigators to lock suspicious accounts earlier than funds may be moved past restoration.

Officials stated legislative amendments are anticipated to be submitted to the National Assembly in the primary half of 2026, with South Korea additionally increasing coordination with world regulators such because the Financial Action Task Force to align with worldwide requirements.

As reported, South Korea faces mounting concerns that its digital asset taxation, scheduled to begin in January 2027, might face a fourth postponement due to persistent infrastructure gaps and unclear regulatory pointers.

Despite 5 years for the reason that tax legislation’s preliminary approval in 2020 and three previous delays, authorities have failed to set up essential programs for transaction monitoring, earnings classification, and cross-border enforcement.

The publish South Korea to Extend Crypto Travel Rule to Sub-$700 Transactions in AML Clampdown appeared first on Cryptonews.