South Korea's Financial Services Commission announced new guidelines on Nov. 5 requiring virtual asset service providers to report security incidents immediately to the Financial Supervisory Service and the Financial Security Institute upon discovery. Currently, such companies are only obligated to notify the Korea Internet & Security Agency. Financial authorities stated that as virtual assets become increasingly intertwined with the traditional financial industry, rapid incident reporting to regulators is essential for investigation, information sharing, and consumer protection. The commission also plans to enact a "Digital Financial Security Act" applying security standards comparable to the Electronic Financial Transactions Act to sectors handling large volumes of customer data or posing significant asset-loss risks, including virtual asset service providers, insurance agencies, and lending businesses. Legislation is targeted for submission in Q1 2027. Additionally, South Korea will conduct comprehensive security inspections of approximately 580 financial companies, including virtual asset service providers.