South Korea Crypto Fraud Compensation Coverage Expands Under New FSS System

FSS launches 119M won project to integrate virtual assets into fraud refund schemes, mandating exchanges to enforce bank-level anti-fraud and victim assistance protocols.

Woofun AI reports that South Korea's Financial Services Agency has initiated a three-month project with an 119 million won budget to reconstruct its fraud refund infrastructure. This effort aligns with the revised Telecommunications Fraud Damage Compensation Act, which formally classifies virtual assets as 'damaged property' and 'refundable property' starting October 1.

The upgraded system will calculate compensation based on token types and quantities, referencing won values at the time of fund freezing, while enabling the separation of fraudulent proceeds across multiple accounts. Major exchanges including Upbit, Bithumb, Coinone, Korbit, and GOPAX must now fulfill anti-fraud obligations equivalent to banks, such as verifying transaction purposes, monitoring suspicious funds, and freezing suspected accounts.