South Korea’s financial watchdogs have imposed a unified, stricter withdrawal-delay system across all domestic crypto exchanges in a bid to choke off a recent spike in voice-phishing scams that rely on lightning-fast transfers.
The Financial Services Commission (FSC) and Financial Supervisory Service (FSS) announced the new rules, removing the discretion exchanges previously had to grant exceptions to holding periods. Until now, platforms set their own criteria for instant withdrawals to keep trading fluid; fraud rings learned those loopholes and coached victims to exploit them.
Voice-phishing schemes typically pressure victims to convert cash into crypto and move funds within minutes. Even brief delays can disrupt these attacks by giving victims time to reconsider or by triggering alerts before funds leave an account. Under the new nationwide standard, exchanges must apply the same objective criteria when evaluating withdrawal-exception requests — looking at account history, transaction patterns and sudden behavioral changes.
Regulators expect fewer than 1% of users to qualify for instant withdrawals under the tightened rules. Exchanges are also required to strengthen identity verification and to increase monitoring of fund flows, shifting responsibility for anti-phishing safeguards from individual firms to a national framework.
The move contrasts with other markets such as the U.S. and Europe, where withdrawal holds are common but typically set by individual firms; some exchanges even let users impose their own timelocks for added protection. South Korea’s change signals a more centralized approach aimed at stemming a persistent and fast-moving fraud vector.
The FSC and FSS did not immediately respond to CoinDesk’s request for additional comment.
Read more AI-generated news on: undefined/news
