The South Korean regulator noted that popular stablecoins used by the public could become a primary tool for money laundering using digital assets.
South Korea’s financial watchdog, the Financial Services Commission (FSC), is monitoring crypto-assets with assets of over 100 million won ($70,000) to prevent money laundering efforts involving digital assets. .
The FSC found that a higher proportion of digital assets and stablecoins corresponds to a higher risk of money laundering. Therefore, a special focus should be placed on monitoring crypto whales with significant digital assets and stablecoin holdings under the new anti-money laundering guidelines, local media reported.
The report also found that stablecoins, especially those commonly used by the public, are more likely to be used as a means of crime. The report says:
“In the case of an independently listed virtual asset, it is possible that it has not met 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 is high.”
In addition to monitoring crypto whales and their activities, the report also calls for keeping an eye on merchant clients making high-value deposits. These clients must be monitored quarterly for any significant changes in ownership.
“Customers with large holdings of virtual assets are at a higher risk of money laundering.”
South Korea is known for its strict implementation of policies related to cryptocurrencies, especially after the collapse of the Terra ecosystem. Its financial regulators have redoubled their efforts to ensure investor protection and implement cryptocurrency legislation in early 2024.
Related: Koreans Will Have Access to Blockchain-Powered Digital IDs By 2024
In August, the FSC president said the regulator plans to speed up its review of 13 digital asset-related bills pending in the country’s National Assembly. The aim of the review is to make institutional additions that take a balanced approach to blockchain development, investor protection and market stability.