TechFlow news: The Director of the Financial Services Commission of Korea announced that deposit and custody services for virtual assets will be banned, a measure taken in response to the consecutive withdrawal incidents involving Korean crypto finance companies Haru Invest and Delio in June 2023.
Under the new "Virtual Asset User Protection Act," virtual asset management firms will no longer be allowed to offer deposit services and must actually hold clients' entrusted virtual assets. This move effectively prohibits deposit and custody operations for virtual assets, targeting companies like Haru and Delio that previously accepted customers’ virtual assets and paid interest. Such practices will now be restricted under the new regulations.
Prior to this, the virtual asset management service Heavybit has already ceased its virtual asset deposit services in compliance with the new law. Notably, Haru Invest and Delio are currently under investigation on suspicion of fraud and other charges.
