South Korea has transferred around 40 unregistered virtual asset service providers to law enforcement authorities.

According to the Financial Intelligence Analysis (FIU) under South Korea’s Financial Services Commission (FSC), around 40 unregistered virtual asset service providers have been reported to law enforcement authorities. Under South Korea’s Specific Financial Information Act, platforms operating crypto asset businesses in South Korea must obtain an Information Security Management System (ISMS) certification and complete registration with the FIU; overseas platforms serving South Korean users are also subject to these rules. Unregistered platforms are not covered by regulations such as the Virtual Asset User Protection Act, leaving users at risk of personal data leaks, hacking, fund misappropriation, and operator exit scams, with difficulties in pursuing claims and recovering losses if incidents occur. Additionally, the FIU disclosed various typical violations, including attracting South Korean users via channels like Telegram and KakaoTalk while deliberately omitting Korean language services to evade regulation, and private money exchange institutions providing stablecoin-fiat currency conversion services to groups such as international students and foreign workers. The FIU will continue to partner with relevant agencies to step up crackdowns on illegal crypto asset businesses and expand joint investigations and regular monitoring mechanisms.