Do Crypto & Stock Influencers (KOLs) Have to Disclose Their Holdings? What the New Korean Law Means for You
Crypto and stock influencers in Korea are increasingly hearing the term "mandatory asset disclosure" — and for good reason.
The Democratic Party of Korea is preparing legislation that would require financial influencers (KOLs) who recommend stocks or crypto assets to publicly disclose the type and quantity of assets they hold, as well as any compensation they receive.
What Does the Proposed Amendment Actually Require?
The proposed amendment to the Virtual Asset User Protection Act centers on three key obligations.
Anyone who repeatedly recommends crypto, stocks, or other financial investment products to a broad audience — or who receives compensation to encourage trading — must disclose the type and quantity of assets they hold, along with any remuneration received.
Remuneration includes not just cash, but tokens, commissions, advertising fees, and other forms of payment.
The penalties are what make this significant. This is not a minor administrative fine. Violations could be treated on par with market manipulation and front-running under the Capital Markets Act — in other words, a serious market order violation.
Why Does This Matter Now, Before the Law Has Even Passed?
Even before the legislation is enacted, the market has already shifted. Influencers who do not disclose their holdings are increasingly viewed with suspicion.
In the digital asset space in particular, a common practice has come under scrutiny: receiving token allocations at below-market prices with short lock-up periods, then publishing investment recommendation content to followers. This structure is one of the primary targets of the proposed legislation.
Once the law passes, past content could also become an issue. That is why now is the time to review how your channel operates.
What KOLs and Trading Room Operators Need to Check Right Now
The core question is: what do I need to disclose, and how much?
1. Disclosure of Holdings in Recommended Assets
If you recommend a coin or stock, you need a clear standard for disclosing whether you hold it, the size of your position, and when you acquired it. Simply mentioning that you also hold the asset is not enough — the specific wording and timing of your disclosure matters.
2. Compensation Received from Projects or Exchanges
If you receive cash, tokens, commissions, or advertising fees from any project or exchange, you need to document what form the payment takes, when it is received, and where and how it is disclosed in your content. Receiving compensation is not itself a problem. Concealing it is.
3. Paid Trading Rooms and Membership Services
Even if you describe your service as "sharing information," you need to assess whether it could be characterized as investment advisory activity in substance. This includes checking whether you meet the registration requirements for a quasi-investment advisory business, and whether your terms of service and operating structure are aligned with the direction of the new regulations.
If Any of the Following Apply to You, Consult a Lawyer Before Continuing
- You have received tokens or commissions from a project and recommended that asset to your audience.
- You operate a paid trading room or membership service where you share trade timing information.
- You have used language such as "principal guaranteed" or "guaranteed returns" in your content.
- You have received token allocations with short lock-up periods or favorable pricing, and subsequently published investment recommendation content.
If any of these apply, the way you currently operate your channel may be a direct target of the proposed legislation.
If You Run a Channel, Set Your Standards Now
The question we hear most often from KOLs and influencers is this:
"How much do I actually need to disclose? If I share too much, I expose my strategy. If I share too little, it looks like I'm hiding something."
The answer is not to disclose everything. It is to establish a clear, consistent disclosure standard that fits your business model — before a problem arises.
In actual virtual asset and capital markets cases, individuals who had defined their disclosure and documentation standards in advance and applied them consistently had significantly more room to defend themselves when investigations or complaints arose.
Decent Law Firm's Virtual Asset Practice Group can help you identify where your current channel and content structure may carry legal exposure, establish an asset disclosure standard aligned with amendments to the Capital Markets Act and the Virtual Asset User Protection Act, draft disclosure language and disclaimers for conflict-of-interest situations, and review your terms of service and operating structure if you run a paid service.
If you are already running a channel, or planning to launch KOL activity in earnest, get your standards in place now — before a complaint, investigation, or lawsuit forces the conversation.
Contact Decent Law Firm's Virtual Asset Practice Group today.
