South Korea Removes Threshold for Crypto Travel Rule

South Korea is expanding its cryptocurrency Travel Rule to include all transfers between registered virtual asset service providers (VASPs), regardless of value. The country's Cabinet approved amendments to the Enforcement Decree of the Act on Reporting and Using Specified Financial Transaction Information.

The current threshold for applying the Travel Rule was $700, but it will now be removed to prevent users from circumventing the rule by splitting transfers into smaller amounts.

According to the Financial Intelligence Unit, one case in which a user bought Tether USDt (USDT) after depositing about 200 million won into a crypto exchange and then made 216 withdrawals, each worth less than $700, led to this change.

The amended decree also introduces new Anti-Money Laundering (AML) requirements for transfers involving overseas exchanges and personal wallets. Registered local VASPs will be required to determine which transfers they allow based on the risk posed by the counterparty.