South Korea gradually opens corporate virtual asset real-name accounts, advancing institutional participation in the crypto market step by step
TechFlow Selected TechFlow Selected
South Korea gradually opens corporate virtual asset real-name accounts, advancing institutional participation in the crypto market step by step
The Financial Services Commission of Korea has drafted a roadmap to gradually allow corporate participation in the virtual currency market within a range that does not compromise user protection and market stability.
Navigating Web3 tides with focused insightsSource: Newsis
Translation: KarenZ, Foresight News
On February 13, South Korea held its third Virtual Asset Committee meeting, planning to allow corporations to open virtual asset real-name accounts in phases, gradually opening institutional participation in the cryptocurrency market. This policy marks South Korea officially opening its virtual asset market to corporate investors, reflecting changes in the country's cryptocurrency environment and signaling the mainstreaming of cryptocurrencies. However, enforcement agencies such as prosecutors' offices and the National Tax Service have already been permitted to open real-name accounts, potentially transferring and selling confiscated criminal proceeds or seized delinquent tax assets held in cryptocurrencies, which may raise market concerns.
What exactly did today’s third Virtual Asset Committee meeting chaired by South Korea’s Financial Services Commission decide? The following is translated from Newsis.
Kim So-young (acting), Vice Chairperson of South Korea's Financial Services Commission, convened the third Virtual Asset Committee meeting and decided to advance the plan for corporate virtual asset real-name accounts in three stages—first allowing institutions that require accounts for "cash conversion purposes," such as enforcement agencies, non-profit corporations, and virtual asset exchanges, with future expansion to professional investment corporations (for investment and financial purposes) and general corporations.
Accordingly, the Financial Services Commission has drafted a roadmap to gradually allow corporate participation in the cryptocurrency market without compromising user protection and market stability.
Phase One: Enforcement Agencies, Non-Profit Corporations, and Exchanges
Enforcement Agency Accounts (Completed)
Prosecutors’ offices, the National Tax Service, customs authorities, and local governments, which need to transfer and sell virtual assets seized from criminal proceeds or forcibly collected delinquent taxes, have been allowed to open accounts since November last year.
Non-Profit Corporation Accounts (Planned for Q2 2025)
Non-profit corporations, including designated donation organizations that need to receive and liquidate cryptocurrency donations, will be allowed to open corporate accounts in the second quarter of this year. However, due to the lack of clear standards and procedures for receiving and liquidating virtual assets, internal control standards must be established in advance.
Virtual Asset Exchange Accounts (Planned for Q2 2025)
Exchanges need to sell virtual assets they earn from fees (their own assets) to cover operational expenses such as employee salaries and taxes, making immediate sales transactions necessary.
Given that such sales could resemble proprietary trading and potentially harm users through price declines, the government plans to establish public guidelines restricting the types and quantities of virtual assets that can be sold.
Phase Two: Professional Investment Corporations (Planned for H2 2025)
The second phase, scheduled for the second half of this year, will allow professional investment corporations to invest in virtual assets. Under the Capital Markets Act, professional investment corporations do not include financial firms but refer to listed companies and corporations registered as professional investors (approximately 3,500). This pilot aims to gradually open trading for investment and financial purposes, starting with buy-sell transactions by institutional investors capable of bearing risks.
Due to potential anti-money laundering risks from large-scale virtual asset transactions, the government will implement this phase only after establishing relevant guidelines and monitoring measures. Additionally, account openings will undergo thorough reviews by banks and exchanges due to varying investment capabilities among corporations.
Phase Three: General Corporate Participation (Mid-to-Long-Term Plan)
Full participation by general corporations will be studied as a mid-to-long-term plan, requiring secondary legislation related to virtual assets and systemic adjustments such as foreign exchange taxation. Phase-two legislation must include oversight of virtual asset exchange business activities and regulation of stablecoins. At the same time, the Foreign Exchange Transaction Act must be improved to monitor cross-border virtual asset transactions.
Future Plans and Outlook
The Financial Services Commission plans to collaborate with government and private institutions to develop guidelines for corporate participation in virtual asset investments. Vice Chairperson Kim So-young stated: "Regarding Phase Two virtual asset legislation, including issues such as stablecoins, dealers, and transaction supervision, we will accelerate discussions within the Virtual Asset Committee." She added: "On token securities, the relevant legal amendment has already been submitted, and we will actively support the National Assembly in swiftly passing the bill."
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
@newsis
