South Korean regulators have clamped down on cryptocurrency withdrawal policies after criminals exploited loopholes to steal 170.5 billion won ($126 million) between June and September 2025. The Financial Services Commission (FSC) and Financial Supervisory Service (FSS) announced an enhanced withdrawal delay system on April 8, eliminating exchange-specific exception rules that allowed fraudsters to bypass security measures.

Previously, exchanges permitted users to circumvent 24-72 hour withdrawal holds if they met platform-specific criteria—such as minimum transaction days or deposit counts. Fraudsters manipulated these requirements, often moving stolen funds within minutes. Nearly 60% of last year’s crypto fraud cases involved accounts exempt from withdrawal delays.

The new standardized rules remove discretionary exceptions, forcing all exchanges to enforce uniform safeguards. This follows a pattern of global regulatory tightening as jurisdictions grapple with balancing innovation and investor protection in cryptocurrency markets.