South Korea wants the global crypto compliance net to catch smaller fish. The country’s Financial Intelligence Unit is lobbying the Financial Action Task Force to expand Travel Rule requirements to cover virtual asset transfers below the current reporting threshold, a move that would force exchanges to share sender and recipient data on even modest transactions.
The push comes during FATF plenary sessions held June 21-22, 2026, where the FIU argued that the existing threshold, set at KRW 1 million (roughly $700 to $842) for international transfers, leaves a gap that bad actors are happily exploiting.
What the Travel Rule actually does, and why the threshold matters
The Travel Rule, codified under FATF Recommendation 16, requires Virtual Asset Service Providers to collect and transmit identifying information about both the sender and receiver of a crypto transfer.
South Korea first implemented its version of the Travel Rule in March 2022, applying it to cross-border transfers above the KRW 1 million mark. The problem, according to the FIU, is a technique called “smurfing.” That’s the practice of breaking a large transfer into many smaller ones, each falling below the reporting threshold, to avoid triggering compliance checks.
