Monat: Januar 2026

• The proposal would let regulators suspend transactions before gains are laundered or moved.
• Authorities want to extend stock market-style enforcement tools to crypto trading.
• Recent actions by tax and financial regulators show tighter alignment with traditional finance rules.

South Korea’s financial regulators are reviewing whether to allow transactions to be suspended before suspected price manipulators can move or launder gains.

The idea is to act earlier in fast-moving crypto markets, where profits can be transferred quickly and become harder to trace.

If adopted, the change would mark a significant step in the country’s second phase of crypto regulation, which is expected to expand beyond user protection and address market abuse more directly, alongside work on stablecoin rules that are yet to be formally introduced.

Early intervention tools

The Financial Services Commission, or Financial Services Commission, is reviewing a payment suspension system that would allow regulators to block crypto transactions at an earlier stage.

Local outlet Newsis reported on Tuesday that the proposal would enable authorities to act before suspected manipulators cash out or launder potentially illicit profits.

Under the current framework, freezes often depend on court warrants.

That process can take time, giving suspects room to conceal funds. Regulators argue that crypto markets move faster than traditional assets, making delays more costly.

The proposed system would mirror tools already used in South Korea’s stock market, where accounts linked to suspected manipulation can be frozen before profits are realised.

Closing enforcement gaps

Market watchdogs have flagged specific tactics that can generate large but unstable gains in crypto trading.

These include front-running, automated wash trading, and placing high buy orders that inflate prices.

Such profits can vanish quickly once assets are moved off exchanges.

Regulators say crypto markets require stronger tools because assets can be transferred into private wallets with relative ease. This mobility, they argue, makes early intervention critical.

Lessons from capital markets

South Korea has already expanded its powers in traditional finance. Amendments to the Capital Markets Act, an Capital Markets Act, took effect in April 2025.

These changes allow account freezes for suspected unfair trading or illegal short sales.

According to reports, the FSC discussed extending similar measures to crypto during a closed-door meeting in November.

The talks took place while authorities were reviewing the first price manipulation case handled under the amended capital markets rules.

South Korea adds on regulatory tightening

The proposal builds on a series of measures highlighting South Korea’s effort to bring crypto regulation in line with standards applied in conventional financial markets.

On Oct. 10, the National Tax Service warned that cryptocurrency holdings kept in cold wallets remain subject to enforcement, noting its authority to conduct home searches and seize offline storage devices in tax evasion investigations.

On Dec. 7, the Financial Services Commission examined the idea of applying bank-style liability to crypto exchanges, which would require platforms to compensate users for losses caused by hacks or system failures even in the absence of proven negligence.

The post South Korea weighs preemptive crypto account freezes to curb market abuse appeared first on CoinJournal.

• RWA projects are treated as illegal fundraising, securities, or futures activities under existing law.
• Hong Kong-linked and offshore structures with mainland staff are explicitly targeted.
• Liability extends to the full Web3 service chain, not just token issuers.

China has delivered one of its clearest signals yet on digital finance, formally classifying real-world asset tokenization as an illegal financial activity.

A coordinated notice from seven major financial industry associations places RWA tokenization in the same prohibited category as stablecoins, cryptocurrencies, and crypto mining.

The move shuts down any remaining ambiguity around whether tokenized assets could evolve under future regulatory pilots.

Instead, regulators have drawn a hard line that reaches beyond project issuers to the entire Web3 service chain, including Hong Kong-linked operations and offshore structures with mainland staff.

The declaration was jointly issued by the China Internet Finance Association, the China Banking Association, the China Securities Association, the China Asset Management Association, the China Futures Association, the China Association of Listed Companies, and the China Payment and Clearing Association.

Unified regulatory warning

The associations stated that RWA activities have no legal basis under existing Chinese law.

Tokenization was defined as financing and trading through the issuance of tokens or token-like rights and debt instruments, a structure regulators say introduces layered risks tied to fictitious assets, operational failure, and speculative trading.

Crucially, authorities stressed that no Chinese regulator has approved any form of real-world asset tokenization, eliminating claims that projects are in trial phases or awaiting registration.

Legal observers described the announcement as a rare example of cross-industry coordination, typically reserved for moments when regulators aim to contain systemic financial risk.

Legal breaches outlined

The notice mapped RWA activity directly to violations under China’s Criminal Law and Securities Law.

Token issuance to the public while raising funds can be treated as illegal fundraising.

Facilitating token transactions or distributions without approval may constitute unauthorised public securities offerings.

Trading models that involve leverage or betting mechanisms can fall under illegal futures business operations.

Regulators also rejected the premise that token structures can guarantee ownership or liquidation of underlying assets.

Even where teams claim transparency or genuine collateral, authorities argue that risk spillovers remain uncontrollable.

Hong Kong and offshore routes

The warning explicitly targets projects that attempt to bypass mainland rules through overseas compliance narratives, asset anchoring claims, or technology service exports.

China’s securities regulator is urging domestic brokerages to halt involvement in RWA tokenization activities in Hong Kong, extending the policy reach beyond the mainland.

A key feature of the directive is the liability standard applied to service providers.

Institutions and individuals who knew or should have known that they were supporting virtual currency or RWA-related business can be held accountable.

This objective standard undermines common Web3 models that rely on offshore registration while maintaining teams and operations in China.

Web3 service chain impact

Responsibility is not limited to project founders.

Technology outsourcers, marketing agencies, influencers, payment interface providers, and operational staff all face legal exposure if they support RWA projects aimed at Chinese users.

The notice states that even employing a single operations worker in China can expose an offshore project to enforcement risk.

Regulators linked the crackdown to rising fraud under the RWA label, including schemes involving stablecoins, valueless tokens, and mining narratives used for illegal fundraising and pyramid activities.

The timing also aligns with China’s push to internationalise the digital yuan via a new Shanghai centre for cross-border payments and blockchain services, while restricting private stablecoin issuance to preserve state control over currency issuance.

The post China bans real-world asset tokenization, classifying it as illegal finance appeared first on CoinJournal.

• FIU reviews linked crypto transactions to scams, fraud, gambling networks, and serious criminal activities.
• Non-compliant crypto platforms were fined ₹28 crore in FY 2024–25 for AML breaches.
• Authorities are building intelligence on transaction hotspots and high-risk digital assets.

India is accelerating its push to regulate the crypto sector as enforcement agencies sharpen their focus on financial crime risks linked to digital assets.

During the 2024–25 financial year, 49 cryptocurrency exchanges formally registered with the Financial Intelligence Unit, marking a decisive step toward tighter anti-money laundering and counter-terror financing controls.

The move reflects a broader regulatory recalibration as authorities respond to growing evidence of crypto misuse and expand scrutiny across platforms operating in the country.

The regulatory shift has also triggered wider discussion within the domestic crypto ecosystem.

A recent post on X by CoinDCX CEO Sumit Gupta drew attention to the intensifying compliance environment, as exchanges increasingly operate under FIU supervision.

The post circulated as registration, monitoring, and enforcement became central themes in India’s crypto policy during the financial year.

FIU flags misuse risks

A review of Suspicious Transaction Reports submitted by crypto platforms during FY 2024–25 revealed repeated patterns of high-risk activity, reported the Press Trust of India.

The analysis found crypto funds linked to scams, fraud, gambling networks, unaccounted transfers, and peer-to-peer misuse.

The FIU also identified more serious risks, including links to dark net services, terror financing, and child sexual abuse material.

Exchanges under one regulator

Of the 49 registered exchanges, 45 are based in India, and four operate overseas.

Unlike several jurisdictions where crypto oversight is split across multiple agencies, India has designated the FIU, which operates under the Ministry of Finance, as the single authority responsible for supervising crypto exchanges.

Industry leaders have pointed out that India’s crypto market is more competitive than it is often perceived, with multiple platforms vying for users and liquidity.

This competitive environment, they argue, can support innovation, provided regulatory expectations are clear and consistently enforced across all players.

Compliance rules explained

Crypto exchanges in India are classified as Virtual Digital Asset Service Providers and have been covered under the Prevention of Money Laundering Act since 2023.

As part of this framework, platforms are required to submit Suspicious Transaction Reports, identify wallet owners, track token fundraising activity such as IPO-style launches, and monitor transfers between hosted and un-hosted wallets.

Following registration, exchanges must also disclose their banking relationships, appoint compliance officers, conduct internal audits, apply risk-based customer checks, screen transactions against sanctions lists, and carry out regular risk assessments.

All relevant data must be shared with the FIU to support ongoing supervision.

Enforcement and penalties

Enforcement has accompanied registration. During FY 2024–25, crypto platforms that failed to meet Anti Money Laundering (AML) obligations were fined a combined ₹28 crore.

The FIU also mapped regional transaction hotspots and identified digital assets frequently associated with illicit activity, strengthening the government’s broader monitoring and intelligence capabilities.

The post India tightens crypto oversight as exchanges move under FIU monitoring appeared first on CoinJournal.