South Korea Tightens Rules for Cryptocurrency Exchanges Amid Acquisition Surge

South Korea is introducing new regulations for virtual asset providers, including cryptocurrency exchanges. The rules require providers to notify authorities at least 30 days before any change in their major shareholders and undergo an eligibility review by the Korea Financial Intelligence Unit (FIU).

The move aims to tighten oversight of major shareholder eligibility, coming amid a string of deals such as Mirae Asset Securities' acquisition of Korbit and investments in Coinone by Korea Investment & Securities and OKX. Providers must identify and submit related documents for the largest shareholder, their related parties, and, if the largest shareholder is a corporation, its largest shareholder and de facto controllers.

The revised review criteria include detailed assessments of financial condition and social credit standing by type of major shareholder. Regulators will also review whether a provider is actually operating, with those that record no business activity for six months or more potentially being denied acceptance of their filing.