Users Transferring Coins Abroad Must Report Holdings to the Bank of Korea Monthly

A plan is being pursued for exchanges to report the personal information and domestic holdings of users who have transferred digital assets abroad to the Bank of Korea every month. This measure is aimed at detecting illegal foreign exchange transactions, but there are concerns that the scope of information collection is excessively broad. Following the implementation of the revised Foreign Exchange Transaction Act on December 3, the Bank of Korea is establishing a reporting system to collect cross-border digital asset transaction information. The collected information will be provided to relevant agencies such as the National Tax Service, Customs Service, Financial Supervisory Service, and Financial Intelligence Unit (FIU) for investigations into illegal foreign exchange transactions. Exchanges must report the details of cross-border digital asset outflows and inflows completed on the same day by 11 a.m. the following day, and the reporting targets include personal information such as the resident registration numbers of senders and recipients, as well as transaction details. Users with a history of overseas transfers must also report their domestic digital asset holdings monthly, and if they have conducted overseas transfer transactions after July 19, 2024, they will be included in the reporting targets even if there are no additional transactions. From July 19 to the end of September 2024, the number of users who conducted cross-border transfer transactions at the five major Korean won exchanges is expected to reach 1,272,878. Lawmaker Park warned that excessive personal information collection could lead to market contraction.

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