In a significant effort to combat voice phishing scams, South Korea's financial regulatory bodies have mandated the implementation of a unified, stringent system for managing withdrawal delays across all domestic cryptocurrency exchanges. This move aims to counter the surge in scams that exploit the speed of transactions.
Previously, exchanges had the discretion to set their own rules for bypassing holding periods, which fraudsters could manipulate by coaching victims on how to bypass these rules. The new rules, announced by the Financial Services Commission and Financial Supervisory Service, remove this discretion and require exchanges to apply uniform criteria, including account history, transaction patterns, and unusual behavioral changes, when considering withdrawal exceptions.
It is anticipated that less than 1% of users will meet the criteria for immediate withdrawals. Additionally, exchanges are required to enhance identity verification processes and closely monitor fund movements. This shift from industry-led security measures to a nationally standardized approach marks a significant change in how South Korea is tackling cryptocurrency-related fraud. Unlike some other markets, such as the U.S.
and Europe, where withdrawal holds are more commonly determined by individual companies, South Korea is adopting a more centralized approach to safeguarding users.