Terraform Money Trail Leads to Swiss Bank

Kyobo Life Insurance, one of South Korea’s largest life insurers, has become a participant in the recently launched public testnet for Circle Internet Group’s Arc. This new open layer-1 blockchain network aims to serve a broad range of use cases, including lending, capital markets, foreign exchange (FX), and global payments.Photo by Kindel Media on PexelsNotable global participants in the Arc networkAccording to a press release from Circle, published on Oct. 28, multiple prominent banks and asset managers are also engaging with the Arc network. Kyobo Life stands as the only South Korean entity involved in the initiative. Other notable global participants include BlackRock, Deutsche Bank, Goldman Sachs, SBI Holdings, and Standard Chartered. This move comes on the heels of Kyobo Life’s earlier participation in a stablecoin project spearheaded by the Seoul-based Open Blockchain & Decentralized Identifier (DID) Association. This highlights the insurer’s growing interest in exploring business opportunities within the digital assets space. Korean crypto exchanges step up oversightAs cryptocurrencies gain increasing recognition as a new asset class, South Korean exchanges have become more vigilant in monitoring user activities, partly to curb potential criminal behavior. A report by Money Today revealed that over the past six years, local trading platforms have halted a total of 82.9 billion won ($58.1 billion) in crypto withdrawals. Among these, Bithumb accounted for the largest share, suspending withdrawals totaling 50.5 billion won ($35.4 million) from 2020 to September 2025. Upbit suspended 25.6 billion won ($18 billion) in the same period, while other exchanges like Coinone, Korbit, and Gopax reported more modest suspensions. These actions are largely in response to the Virtual Asset User Protection Act, which came into effect in July 2024. The Act aims to enhance oversight and safeguard consumers, reflecting the government’s intent to regulate the sector more tightly. Surge in Korea-Cambodia stablecoin tradingParallel to these regulatory developments, a dramatic surge in stablecoin trading volume has been observed between South Korea and Cambodia. According to data from the Financial Supervisory Service (FSS) reported by the Seoul Shinmun, transactions between five major South Korean exchanges and Cambodia’s Huione Guarantee skyrocketed to 12.8 billion won ($8.98 million) in 2024, marking a staggering 1,400-fold increase compared to just 9.22 million won ($6,500) in 2023. This rise in activity coincides with recently uncovered criminal cases originating from Cambodia and has raised concerns about illicit practices within the crypto market. In response to these concerns, crypto exchanges are bolstering their efforts to cooperate with law enforcement. Binance, the world’s largest crypto exchange by trading volume, was recently honored with a commendation by the South Korean Minister of the Interior and Safety for its contributions to enhancing cybercrime investigations and administrative capabilities. This accolade comes amid Binance’s increasing presence in South Korea. Binance, which had acquired Gopax ahead of regulatory approval, has now received clearance from local financial authorities to become the Korean trading platform’s largest shareholder. Public sentiment on Binance’s acquisition of GopaxA recent survey conducted by CoinNess and the community-voting app Cratos, which polled 2,000 South Koreans, provided insights into the public’s perception of Binance’s acquisition of Gopax. Among respondents, 38.8% indicated that their decision to use the rebranded platform would depend on the benefits it offered compared to other exchanges, while 23.6% said they were already planning to use it. Together, these figures suggest that 62.4% of participants are open to the platform, although some are conditioned on its advantages. However, 27.5% rejected the platform entirely, and 10.2% stated they do not use local exchanges at all. As South Korea deepens its role in the global digital asset ecosystem, its growing participation in initiatives like Circle’s Arc network reflects an ambition to align with international finance trends. At the same time, stricter oversight and cross-border monitoring signal a firm commitment to transparency. The balance it strikes between innovation and regulation will define its path in the global crypto arena. 

South Korea, Chainalysis Collaborate to Thwart North Korea’s Crypto CrimesSpecial Representative for Korean Peninsula Peace and Security Affairs Kim Gunn from the Ministry of Foreign Affairs held a meeting with Investigations VP Erin Plante and Korea Country Manager Paek Yong-khi of Chainalysis, a New York-based blockchain analysis company, according to the Ministry’s press release.Photo by Pixabay on PexelsGrowing North Korean crypto theftsSpecial Representative Kim and the Chainalysis representatives discussed response measures against North Korea’s increasing virtual asset theft and money laundering activities. Both sides recognized the severity of North Korea’s illegal cyber activities, which not only jeopardize national security by funding nuclear and missile development, but also threaten the establishment of a healthy cryptocurrency ecosystem.Chainalysis has been tracking North Korea’s illicit virtual asset operations and providing analytical information to a range of organizations, including law enforcement agencies and financial authorities.Special Representative Kim expressed gratitude for the private sector’s role in analyzing and monitoring North Korea’s crypto theft and money laundering activities. Both parties concurred on the importance of public-private cooperation to strengthen countermeasures against illegal cryptocurrency activities as North Korea’s techniques have become increasingly sophisticated.Plante also appreciated the South Korean government’s initiative in thwarting North Korea’s illicit cyber activities. These measures include imposing independent sanctions on North Korean hacker organizations and tech personnel and establishing a working group with the United States to counter North Korean cyber threats.Korean police and ChainalysisIn addition to its collaboration with the Ministry of Foreign Affairs, Chainalysis has been working with another Korean government agency. It was recently reported that the Korea National Police Agency (KNPA) is intensifying its efforts to enhance its expertise in investigating digital asset-related crimes. To achieve this goal, the KNPA is encouraging its officers to obtain certifications provided by Chainalysis.

In a move to enhance the oversight of cross-border wire transfers involving virtual assets, Bangko Sentral ng Pilipinas (BSP), the central bank of the Philippines, is fortifying the implementation of regulations relative to crypto transfers.Photo by C Bueza on UnsplashTravel rule clarificationsLocal news outlet, the English language newspaper The Philippine Star reported that central bank memorandum 2023-042 provides clarifications on the travel rule for virtual asset service providers (VASPs). The travel rule requires financial institutions to pass on information to the next institution where a transaction takes place. The BSP aims to bring greater clarity to several aspects, including the applicability of the P50,000 transaction threshold and expectations regarding transactions involving jurisdictions without travel rules. Additionally, further interpretation is being provided concerning the extension of the Philippine travel rule to non-custodial VASPs and regulatory expectations surrounding transactions with unhosted wallets or crypto wallets controlled directly by their owners, rather than managed by third-party service providers. FATF compliance ambitionThis regulatory move is in response to the directives from the Paris-based Financial Action Task Force (FATF). In 2021 the Philippines came under greater scrutiny from the intergovernmental organization, when it was included on its "gray list," making it a candidate for increased monitoring. The FATF has called upon the Philippines to establish guidelines for the travel rule to prevent terrorists and criminals from exploiting virtual asset transfers for the unrestricted movement of their assets and to detect and prevent misuse effectively.BSP-supervised financial institutions (BSFIs) are now mandated to scrutinize specific details of virtual asset transfers, including the originator's name, account number used in the transaction, originator's physical address or national identity and the beneficiary's name and account number. International moves towards complianceThis latest move by the Philippine central bank is not unusual. In recent months, a plethora of similarly motivated central banks around the world have tightened up on crypto regulation as it relates to the FATF directives. Being on the FATF's "gray list" is bad for a country’s reputation. It has the potential to result in loss of investor confidence and lead to higher compliance costs and greater monitoring. Additionally, it may have an impact on trade relations and damage a country’s ability to access international finance.  Turkey has also found itself on the organization’s gray list. Working towards repairing that situation, Turkey is in the process of establishing a crypto regulatory framework that will be FATF compliant.In May, Pakistan went a step further in banning cryptocurrency. At the time, its Minister of State for Finance and Revenue, Aisha Ghaus Pasha, stated that the ban had been a requirement for Pakistan’s removal from the FATF gray list. A tightening of crypto regulations has also occurred in the United Arab Emirates (UAE) and in Hong Kong more recently, as those territories work towards ensuring FATF compliance. The BSP emphasizes that transactions not surpassing the P50,000 threshold or its equivalent in foreign currency must include the names and account numbers of both the originator and beneficiary. Both originating and beneficiary VASPs are required to establish and adhere to robust sanction screening procedures, ensuring compliance with sanctions lists and preventing transactions involving sanctioned individuals, entities, or jurisdictions.