South Korea’s financial regulators have ordered all domestic crypto exchanges to adopt a single, strict system for delaying withdrawals, aiming to block a rise in speed-dependent voice phishing scams.
The Financial Services Commission and the Financial Supervisory Service announced the new rules, removing the discretionary exchanges that were once supposed to let users bypass holding periods, local news media reports.
Previously, platforms set their own exceptions to keep trading fast. Scam groups learned these rules and coached victims to slip through them.
Voice phishing scams often pressure victims to convert cash to crypto and send it out within minutes. A delay, even a short one, can interrupt the scam by giving victims time to reconsider or allow alerts to appear before money leaves an account.
Under the new system, exchanges must apply the same criteria when reviewing withdrawal exceptions. These include account history, transaction patterns, and sudden changes in behavior. Officials expect fewer than 1% of users to qualify for immediate withdrawals. The platforms must also tighten identity controls and monitor money flows more closely.
The move marks a shift from industry-led safety measures to a national standard.
In other markets, such as the US and Europe, withdrawals are common but set by individual firms. Some exchanges even let users set their own time locks to prevent unwanted withdrawals.
South Korean regulators did not immediately respond to CoinDesk’s request for further comment.
