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- South Korea crypto regulators seek wider Travel Rule checks for smaller transfers.
- FIU says both sending and receiving crypto service providers should follow the rule.
- FATF review shows global crypto AML adoption remains uneven across jurisdictions.
South Korea crypto regulators are seeking wider reporting duties for digital asset transfers, aiming to align local rules with global anti-money laundering standards. The proposal would extend checks to smaller transfers between crypto service providers.
According to the announcement, the Financial Intelligence Unit (FIU) raised the proposal during a Financial Action Task Force plenary meeting in Paris last week. South Korea crypto rules already apply Travel Rule checks to transfers above 1 million won, or about $650.
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South Korea Crypto Rules Target Offshore Platform Risks
The Travel Rule requires exchanges to share sender and recipient data for covered transfers. It is designed to improve traceability when funds move between platforms. The FIU now wants those duties to cover smaller transactions.
The agency also said both originating and receiving crypto asset service providers should follow the rule. That approach would target gaps in cross-border transfers. South Korea crypto officials said uneven enforcement can leave weak points in the payment chain.
The FIU called for tougher action against offshore and unregistered platforms. It cited rising misuse in illicit finance cases. Regulators said these venues can increase regulatory arbitrage when oversight differs across countries.
DeFi risks were also discussed at the FATF meeting. The FIU said FATF approved a new report on risks tied to decentralized finance. Commissioner Lee Hyung Ju welcomed the report and said arbitrage stems from differences in licensing, supervision, and offshore oversight.
FATF Data Highlights Gaps in Crypto Oversight
The proposal forms part of wider work on FATF Recommendation 15. The standard was updated in 2019 to apply anti-money laundering controls to crypto assets and crypto asset service providers. South Korea crypto regulators used the meeting to press for closer alignment.
FATF’s 2025 targeted update showed global adoption remains uneven. It found 49% of jurisdictions were partly compliant with requirements for crypto asset service providers as of April 2025. Another 21% were non-compliant.
That left about 29% of jurisdictions rated largely compliant or compliant. South Korea crypto authorities said wider reporting could help close those gaps. The proposal also shows how South Korea crypto oversight remains focused on transfers, offshore platforms, and DeFi risks.
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