South Korea Cracks Down on 40 Unregistered Crypto Platforms

The regulator identified a pattern of illicit activity where foreign platforms recruit South Korean residents via Telegram and KakaoTalk, often masking their presence by conducting support operations exclusively in English. These entities operate outside the scope of the Virtual Asset User Protection Act, leaving customers with no recourse during cyberattacks, data breaches, or disputes over undisclosed fees. Authorities noted that some businesses were specifically targeting international students and foreign workers to facilitate fiat-to-crypto exchanges without the necessary certifications.

This enforcement action arrives as the government prepares to implement stricter rules for cross-border digital asset transfers this December. Amendments to the Foreign Exchange Transactions Act will mandate that international transfer services register with the Ministry of Economy and Finance and report data through the Bank of Korea. The urgency for oversight follows a massive surge in crypto-based remittances, which climbed from 34.02 trillion won in 2022 to 163.55 trillion won by 2025. Officials confirmed that joint investigations will continue, urging the public to report suspicious platforms to the FIU or the Digital Asset eXchange Alliance.