The South Korean Financial Services Commission (FSC) announced that the government approved the amendment to the "Act on Reporting and Using Specified Financial Transaction Information" at a cabinet meeting on August 11. The new regulations will impose stricter registration requirements on Virtual Asset Service Providers (VASPs) and strengthen their Anti-Money Laundering (AML) obligations in virtual asset transfers.

Key contents of the amendment include:
1. Enhanced Registration Requirements: Expanding the scope of review for major shareholders, and introducing specific requirements for VASPs' financial soundness (e.g., debt-to-equity ratio below 200%), social credibility, executive qualifications, technical systems, and internal control mechanisms.
2. Expanded Scope of Travel Rule Application: The Travel Rule, currently applicable to transfers between registered VASPs exceeding KRW 1 million, will be extended to cover transactions between registered VASPs of all sizes. Furthermore, transfers of KRW 10 million or more to overseas VASPs or digital wallet service providers, regardless of risk level, must be reported to the Korea Financial Intelligence Unit (KoFIU).
3. Strengthened Customer Due Diligence (CDD): VASPs are required to properly fulfill their CDD obligations. For transactions involving money laundering risks, high-risk individuals, or high-risk products/services, more stringent CDD will be required.

The updated rules regarding VASP registration and sanctions for retired employees will take effect on August 20, 2026, while other rule changes will come into force six months after their promulgation.