In a bid to combat the rising tide of voice phishing scams, South Korea's financial regulatory bodies have mandated the implementation of a unified withdrawal delay system across all domestic cryptocurrency exchanges. This move aims to thwart scams that rely on swift transaction processing. Previously, exchanges had the discretion to establish their own rules for exceptions to withdrawal holding periods, which fraudsters exploited by coaching victims on how to bypass these rules. Voice phishing scams typically involve deceiving victims into converting cash to cryptocurrency and transferring it quickly.
Even brief delays can disrupt these scams by giving victims time to rethink or allowing alerts to emerge before funds are transferred out of an account. Under the new rules, exchanges must apply uniform criteria when evaluating withdrawal exceptions, including account history, transaction patterns, and abrupt behavioral changes. It is anticipated that less than 1% of users will be eligible for immediate withdrawals.
Additionally, exchanges are required to enhance identity verification and closely monitor fund movements. This development marks a transition from industry-driven safeguards to a nationwide standard.
In contrast, other markets like the U.S. and Europe have withdrawal holds in place, but these are set by individual companies.
Some exchanges even allow users to set personal timelocks to prevent unauthorized withdrawals. The South Korean regulators have not yet responded to requests for further commentary.