TechFlow News, May 30: According to ZDNet Korea, South Korea’s Financial Intelligence Unit (FIU) has temporarily decided not to proceed with a controversial provision in the amendment to the Act on Reporting and Using Specified Financial Transaction Information. The provision would have required financial institutions to file Suspicious Transaction Reports (STRs) whenever users transferred virtual assets valued at over 10 million KRW (approximately USD 7,300) to overseas accounts or personal wallets.
Earlier, the Digital Asset Exchange Association of Korea (DAXA) submitted feedback on the proposal, arguing that the mandatory reporting mechanism could increase compliance costs for trading platforms and lengthen user transfer processes—imposing additional operational burdens on the industry.
Nonetheless, the FIU will continue advancing its plan to broaden the scope of the Travel Rule. Under the revised arrangement, the rule’s applicability will extend from virtual asset transfers exceeding 1 million KRW (currently applicable) to all transfers—including those under 1 million KRW (approximately USD 730)—to enhance transparency and traceability of digital asset fund flows.
The Travel Rule is a key component of the global anti-money laundering (AML) framework, mandating virtual asset service providers (VASPs) to share sender and recipient information during transactions. South Korean regulators are persistently refining related rules to strengthen oversight of the digital asset market.
