South Korea’s financial watchdog, the Financial Services Commission (FSC), will monitor cryptocurrencies with assets of more than 100 million won ($70,000) to prevent money laundering using digital assets.
The FSC noted that having a higher proportion of digital assets and stablecoins equates to a higher risk of money laundering.. Therefore, special attention should be paid to monitoring crypto whales with significant holdings of digital assets and stablecoins under new anti-money laundering guidelines, local media reported.
The report also noted that stablecoins, especially those in common use among the public, are more likely to be used as a means of committing crimes. The report says:
“In the case of an independently listed virtual asset, it is possible that it did not meet the listing criteria of other virtual asset operators, and it can be assessed that the money laundering risk of virtual asset operators with a high proportion of virtual assets the asset is high”.
In addition to monitoring crypto whales and their activities, the report also advocates keeping an eye on retail clients making high-value deposits. Those clients must be monitored for any significant changes in holdings each quarter.
“Clients with large holdings of virtual assets are at higher risk of money laundering.”
South Korea is known for its strict enforcement of crypto-related policies, especially after the collapse of the Terra ecosystem. Its financial regulators have redoubled their efforts to ensure investor protection and introduce cryptocurrency legislation in early 2024.
In August, the chairman of the FSC said that the regulator plans to speed up its review of 13 bills related to digital assets pending in the country’s National Assembly. The goal of the review is to make institutional plugins that take a balanced approach to blockchain development, investor protection, and market stability.
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