In a significant effort to curb the rising incidence of voice phishing scams, South Korea's financial regulatory bodies have mandated the implementation of a unified, stringent system for delaying withdrawals across all domestic cryptocurrency exchanges. This move aims to thwart scams that rely on rapid transaction processing.
Previously, exchanges had the discretion to set their own rules for bypassing holding periods, which fraudsters exploited by coaching victims on how to circumvent these rules. The new rules, announced by the Financial Services Commission and Financial Supervisory Service, will apply uniform criteria to review withdrawal exceptions, including account history, transaction patterns, and sudden behavioral changes. As a result, fewer than 1% of users are expected to qualify for instant withdrawals.
Additionally, exchanges must enhance identity verification processes and closely monitor fund flows. This shift towards a national standard marks a departure from the previously industry-led approach to safeguards.
Unlike some other markets, such as the U.S. and Europe, where withdrawal holds are common but set by individual firms, South Korea's new system will be universally applied.