1.

Guidelines for Cashing-In Virtual Assets for Non-Profit Corporations
 

• Requirements for Non-Profit Corporations: A non-profit corporation must satisfy the following requirements to be eligible to trade virtual assets: (i) fall under any of the special cases prescribed under the Corporate Tax Act or be an organization receiving general donations, (ii) be subject to external audits and have received an appropriate audit opinion for the past three years, (iii) have not been designated as a “bad faith recipient of donations under the National Tax Basic Act” for the most recent three years, and (iv) have been operating for at least five years. There have been calls for stricter monetary sanctions and the introduction of non-monetary sanctions to prevent the recurrence of unfair trading activities.
   

• Internal Control Standards for Non-Profit Corporations: A non-profit corporation should prepare its own standards based on the “Best Practices for Receiving and Cashing-In Virtual Asset Donations” prepared by the Non-Profit Organization TF. The key details of the Best Practices for Receiving and Cashing-In Virtual Asset Donations are as follows:
   

• Roles of Banks and Virtual Asset Exchanges: When reviewing an application for a non-profit corporation’s real-name verification account to trade virtual assets, the bank will review whether the non-profit corporation meets the requirements, and whether internal control standards for the donation of virtual assets are established. At the time of cashing-in of the virtual assets by a non-profit corporation, the virtual asset exchange will check whether the details of the virtual asset donations and the details of cashing-in are consistent. Banks and virtual asset exchanges may request non-profit corporations to submit data, and if they refuse to submit data, they may take measures such as refusing to open the real-name verification accounts or restricting deposits and withdrawals through such real-name verification accounts.
   

2.

Guidelines for Sale of Virtual Assets by Virtual Asset Service Providers
 

• Scope and Requirements of Permitted Sellers: Among the virtual asset service providers (“VASPs”) that establish and operate the virtual asset market under the Act on the Protection of Virtual Asset Users, those whose new/renewal VASP report has been accepted by the Korea Financial Intelligence Unit (the “KoFIU”) or whose renewal report is being reviewed by the KoFIU under the Act on Reporting and Using Specified Financial Transaction Information would be permitted to dispose of their virtual assets. A sale is permitted only in cases where (i) such sale is intended for the purpose of fulfilling the VASP’s tax obligations (such as its corporate income tax payment obligation) or covering the VASP’s operating expenses (such as labor costs), or (ii) there is a clear concern that the VASP may fail to perform its legal obligation equivalent to such tax obligation or payment obligation to cover operating expenses.
   

• Virtual Assets Eligible for Sale: VASPs may sell virtual assets that are within the top 20 in terms of total market capitalization on five KRW-based virtual asset exchanges and are listed on three or more local KRW-based virtual asset exchanges.
   

• How to Sell: The sale must be completed within three months from the date of public announcement of the sale plan by a resolution of the board of directors. The sale must be carried out on two or more KRW-based exchanges (self-trading through an exchange’s own platform is not permitted), and submitting any price/quantity quote prior to the commencement of the sale is restricted.
   

• Internal Control Procedures: The responsible department at the seller prepares a sale plan including the purpose, target, timing, size, etc., of the sale, reports it to the compliance officer and submits the agenda to the board of directors. Thereafter, the responsible department independently executes the sale in accordance with the sale plan approved and resolved by the board of directors. The department prepares a report on the results of trading and the details of fund usage, and reports these results to the board of directors after review by the compliance officer.
   

• Disclosure: The seller shall disclose the relevant information on the disclosure platform before and after the sale.
   

3.

Improvement Measures for the Best Practices
 

• Strengthening of Review Standards: Establish mechanisms to prevent listing pumps and the indiscriminate listing of meme coins, and set standards for managing zombie coins.
   

• Improvement of Deliberation Procedures: Enhance independence and fairness in the deliberation of trading support to avoid conflicts of interest, and strengthen the process to ensure thorough review.
   

• Expansion of Information Disclosure: Expand information disclosure and guidance to support users’ informed decision-making, and disclose standards related to trading support to ensure transparency in operations (see the DAXA’s Self-Regulation Proposal (Link), available in Korean).
   

• Strengthening of Internal Controls: Require regular internal audits and similar measures to secure the reliability of trading support and ensure accountability among officers and employees performing related tasks.