#SouthKoreaCryptoPolicy South Korea's crypto policy is shaped by its Financial Services Commission (FSC) and Financial Supervisory Service (FSS). Here are some key aspects ¹:

- *Regulatory Framework*: The FSC oversees cryptocurrency regulations, focusing on anti-money laundering (AML) and know-your-customer (KYC) guidelines. The Act on the Protection of Virtual Asset Users (VAUPA) requires virtual asset service providers (VASPs) to comply with strict rules, including storing at least 80% of users' assets in cold wallets.

- *Registration and Compliance*: Crypto exchanges must register with the FSC, collaborate with local banks for real-name verification accounts, and implement KYC and AML procedures. Failure to comply can result in severe penalties, including fines and business suspension.

- *Taxation*: South Korea initially planned to introduce a 20% tax on crypto gains exceeding 2.5 million won, but implementation has been delayed until 2028.

- *ICOs and STOs*: Initial Coin Offerings (ICOs) are banned due to concerns over fraud and market manipulation. Security Token Offerings (STOs), however, are viewed more positively, with the government working on regulations to allow them under the Capital Markets Law.

Under President Lee Jae-myung's administration, South Korea's crypto industry is expected to experience significant policy changes, including ²: