South Korea Tightens the Crypto Grip: “Travel Rule” Extended to Small Transfers
Seoul is introducing new, significantly stricter regulations to combat money laundering (AML) in the crypto sphere. South Korea’s financial regulators are expanding the scope of the so-called “Travel Rule,” which obliges Virtual Asset Service Providers (VASPs) to record and transmit data about transaction participants.
The key change consists of a sharp reduction in the control threshold: now, sender and recipient identification will be mandatory for crypto transfers valued at less than 1 million Korean Won (about $680).
This measure is aimed at blocking channels for “smurfing”—the practice of splitting large illegal sums into numerous small operations to bypass oversight. The country continues to strengthen its position as a jurisdiction with a high level of financial transparency, striving to exclude the use of digital assets for tax evasion and transnational crime. In effect, South Korea is intensifying oversight over every step in its active crypto-economy, raising compliance standards for all market operators.
