South Korea is preparing new rules that could allow fintech companies, not just cryptocurrency exchanges, to offer cross-border digital asset transfer services starting in December.
The move comes after the government approved changes to the Foreign Exchange Transactions Act. The revised law was officially announced on June 2 and will take effect after a six-month transition period.
Under the new system, companies will be able to provide blockchain-based international money transfer and foreign exchange services, but they must first register with the Ministry of Economy and Finance. They will also be required to report overseas transactions through the Bank of Korea’s foreign exchange monitoring system.
South Korean authorities say the changes are needed because cryptocurrency transfers across borders have largely operated outside traditional foreign exchange regulations. Officials believe stronger oversight will help reduce risks related to money laundering and illegal financial activities.
Companies that want to enter the market will need to meet several requirements, including registering as a Virtual Asset Service Provider (VASP), connecting their systems to government reporting networks, and meeting standards related to facilities, technology, and professional staff.
Until now, many people expected large crypto exchanges such as Upbit and Bithumb to dominate the new market because existing VASP rules mainly apply to exchanges and crypto custodians.
However, government officials are now considering opening the door to fintech companies as well. Regulators believe that if these firms can safely provide transfer services and meet all legal requirements, they should be allowed to participate.
The Bank of Korea has already started meeting with industry representatives and providing guidance on how businesses can prepare for the new framework.
Many fintech firms see this as a major opportunity because strict registration rules and banking requirements have made it difficult for them to enter the digital asset industry in the past. A separate licensing system could help them offer blockchain-based remittance and payment services more easily.
The government is expected to continue discussions with industry participants over the coming months before final rules are announced ahead of the December launch.
The initiative is part of South Korea’s broader effort to bring digital assets under clearer regulation while encouraging innovation in financial technology and blockchain-based services.
