South Korea is tightening its cryptocurrency regulatory landscape. BitGo Korea has become the first foreign digital asset firm to secure a local virtual asset service provider (VASP) license directly. Concurrently, South Korean lawmakers have introduced a bill to expand the Financial Intelligence Unit's authority to directly investigate unregistered crypto businesses, addressing enforcement gaps where police suspended 23 of 25 investigations into overseas-based operators.
BitGo Korea VASP registration
- ▪BitGo Korea, the local unit of digital asset infrastructure company BitGo, received approval from the South Korean Financial Intelligence Unit under the Financial Services Commission to operate as a virtual asset service provider on or before August 20, 2026.
- ▪Hana Financial Group and SK Telecom hold strategic stakes of 25 percent and 10 percent, respectively, in BitGo Korea.
- ▪BitGo Korea is the first foreign digital asset company to directly earn virtual asset service provider status in South Korea rather than acquiring an existing local operator.
FIU authority expansion bill
- ▪The proposed bill in South Korea aims to expand the Financial Intelligence Unit's authority to investigate unregistered crypto businesses, file complaints, and request criminal investigations.
- ▪The proposed bill in South Korea would allow any individual to report suspected violations of the Act on Reporting and Using Specified Financial Transaction Information to the Financial Intelligence Unit.
- ▪On August 20, 2026, South Korean People Power Party lawmaker Eom Tae-young and nine other lawmakers filed a bill to amend the Act on Reporting and Using Specified Financial Transaction Information.
Unregistered crypto operator enforcement
- ▪The 23 unregistered virtual asset service providers whose investigations were suspended by South Korean police between August 2022 and August 2025 were reportedly based overseas.
- ▪South Korean police suspended investigations or preliminary inquiries into 23 of 25 unregistered virtual asset service providers referred by the Financial Intelligence Unit between August 2022 and August 2025.
South Korea crypto registration framework
- ▪Crypto companies serving South Korean customers are legally required to register with the Financial Intelligence Unit.
- ▪The South Korean Financial Intelligence Unit reported in June 2026 that 28 virtual asset service providers were registered and 40 suspected illegal operators had been referred to investigative authorities.
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