1. South Korea's Virtual-Asset Regulatory Framework
The Virtual Asset User Protection Act took effect in 2024, establishing a fuller regulatory framework for South Korea's cryptocurrency market.
2. Main Regulatory Requirements
① Exchange Registration and Authorization
Virtual-asset service providers must register with the Financial Intelligence Unit (FIU). Offering KRW trading requires linking real-name deposit and withdrawal bank accounts.
② KYC: Identity Verification
All Korean exchanges require real-name verification. This involves a passport or identity document, mobile-phone verification, and a linked bank account.
③ User Protection
- Mandatory separation of customer assets from exchange assets
- Required systems for monitoring unusual transactions
- Prohibition of unfair trading, including market manipulation and use of undisclosed information
3. Virtual-Asset Taxation
💡 Taxation as Described in the 2026 Guide
The guide states that taxation of virtual-asset income is in effect.
Rate: 22%, including local tax
Deduction: A basic annual deduction of KRW 2.5 million
Filing: During the comprehensive income-tax filing period each May
4. Using Overseas Exchanges
The guide states that South Korean residents are not prohibited from using overseas exchanges such as Binance, but may have overseas financial-account reporting obligations. It lists a reporting threshold of more than KRW 500 million in overseas assets.
5. Investing within Regulation
Regulation aims to make markets safer. The guide presents a transparent environment as supporting more effective automated AI trading.
🃏 AI Trading and Regulatory Compliance
AI trades automatically in an environment described as transparent and lawful.
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