South Korea gives crypto exchanges 7 days to disclose holdings

The framework would affect one of the world's most retail-heavy crypto markets. As of February 2025, 16.29 million people held accounts across South Korea's five largest exchanges, equivalent to nearly 32% of the population. That figure exceeded the roughly 14.2 million people who held domestic listed stocks at the end of 2024.

Once assets are identified and frozen, courts could assign them to creditors or order their liquidation. A virtual asset service provider could execute the sale, while crypto could also be transferred to an enforcement officer's account or converted into more liquid assets before disposal.

The process becomes harder when a debtor controls the crypto directly. A court could prohibit disposal and order a transfer to an enforcement officer, but seizure would take effect only when the officer actually receives the assets. Private-key control remains a practical constraint.

The proposal fits into South Korea's broader effort to build formal rules around a crypto market that has moved deep into the financial mainstream. Authorities have already introduced statutory protections for virtual asset users and are tightening exchange registration and anti-money laundering requirements, including planned expansion of the travel rule and additional controls around personal wallets and stablecoins.

The seizure rules would extend that regulatory build-out into civil debt collection. They would also apply to proceedings already underway when they take effect, making the period between the Aug. 11 consultation deadline and the proposed Oct. 1 rollout particularly relevant for exchanges preparing to handle court orders.