In a significant move to counter the rising tide of voice phishing scams, South Korea's financial regulatory bodies have mandated that all local cryptocurrency exchanges implement a unified, stringent system for delaying withdrawals. This initiative aims to thwart scams that exploit the speed of transactions.
Previously, exchanges had the discretion to allow users to bypass holding periods, but this flexibility has been removed. The new rules, announced by the Financial Services Commission and Financial Supervisory Service, require exchanges to apply consistent criteria when evaluating withdrawal exceptions, including account history, transaction patterns, and unusual changes in user behavior. It is anticipated that less than 1% of users will be eligible for immediate withdrawals under these new guidelines. Furthermore, exchanges are now obligated to enhance identity verification processes and closely monitor fund movements.
This shift towards a national standard marks a departure from the previous industry-led approach to security measures. Unlike some other markets, such as the U.S. and Europe, where withdrawal holds are determined by individual companies, South Korea is adopting a more centralized approach. The regulators' decision reflects a proactive stance against phishing scams, which often rely on rapid transactions to deceive victims into transferring funds within minutes, leaving little time for intervention or second thoughts.