In an interview with South Korea's Minister of Economy and Finance, Choi Sang-mok, revealed that the government has decided to set up a monitoring system to regulate cross-border business transactions involving digital currencies.
According to local media, the latest development is necessary to curb the rising rate of cyber crimes in the region. Meanwhile, per urgency, the Asian nation will implement and execute the proposed regulatory structure in the second half of 2025.
According to the Minister, virtual companies operating within the South Korean region must register with the appropriate authorities. Subsequently, they will submit well-detailed reports containing monthly transactions to the Bank of Korea.
Factors Triggering the New Mandatory Regulation in South Korea
Findings have revealed hidden traces between cyber crimes and virtual currencies. In a G20 business trip featuring financial matters, the Minister spotlighted several dubious acts perpetuated under the cover of foreign exchange activities.
He stated that the heightened illegal activities, money laundering, gambling, and misappropriation of corporate funds are more likely to occur when cross-border digital currencies are traded.
Part of Choi’s statement read thus: “Given the increasing suspicious cases of tax evasion and money laundering for drugs and gambling in recent cross-border transactions, we intend to amend the Foreign Exchange Transactions Act to provide a regulatory basis.”
Additional Plans to Curb Cyber Crimes Involving Virtual Assets
To further curtail future incidences of these crimes in South Korea, plans are in place to establish virtual currencies into mainstream financial systems. Therefore, they will operate under pre-existing laws.
Choi also commented on the current instabilities affecting the exchange rate of Won, at approximately 1400 Won to a dollar. According to him, until the native currency appreciates, its weakness would make it vulnerable to cyber-attacks. “The yen has been weak for a long time, but it’s not because Japan’s competitiveness has declined,” the Minister stated.
