South Korea Bill Targets Unregistered Crypto Firms with Enhanced Enforcement Powers

South Korean lawmakers are pushing to give the country's financial intelligence agency more direct authority over unregistered cryptocurrency firms.

The proposed bill, introduced by People Power Party lawmaker Eom Tae-young and nine other lawmakers, aims to expand the Financial Intelligence Unit's (FIU) power to investigate and act on tips about illegal operators.

Under the current system, the FIU identifies suspected unregistered operators but relies on police and other authorities to pursue investigations. However, data shows that in 92% of cases between August 2022 and August 2025, police suspended investigations or preliminary inquiries into unregistered virtual asset service providers.

The proposed amendment would allow anyone to report suspected violations of the law to the FIU, giving the regulator a clearer path to acting on tips rather than waiting for other agencies. The measure is intended to give the FIU a more direct role in pursuing cases it currently refers to other agencies, closing a gap between detection and investigation.