Perpetual futures Korea investors now have an explicit warning from the country’s financial authorities. On October 16, 2026, the Financial Services Commission (“FSC”), the Korea Financial Intelligence Unit (“KoFIU”), and the Financial Supervisory Service (“FSS”) issued a joint press reference, “Notice on Precautions for Users of Perpetual Futures” (무기한 선물 이용자 유의사항 안내). The notice concerns perpetual futures based on stocks, virtual assets, and other underlying assets that are being listed and traded on offshore platforms, including overseas virtual asset exchanges.

For offshore exchanges, digital asset businesses, and investors with exposure to the Korean market, the notice does two things. It tells Korean investors that these products carry very high risk and fall outside Korean investor protection. It also signals that the authorities are watching offshore products linked to the Korean stock market and will act against offshore operators that solicit Korean residents.

Three Key Messages

The authorities summarized their position in three points:

• Total loss risk. Ultra-high leverage means that even a small move in the price of the underlying asset can wipe out the entire investment.
• No Korean legal remedy. Investor protection under Korean law does not apply, so users may have no legal remedy in the event of an incident or dispute.
• Enforcement. If an offshore platform is found to be conducting illegal business in Korea, the authorities will take strict action, including referral to investigative authorities.

Not “Futures” in the Korean Regulatory Sense

Perpetual futures (무기한 선물) use a name similar to the futures traded in Korea’s regulated markets, but their structure is different. According to the notice, perpetual futures traded on offshore platforms:

• have no expiry date;
• do not presuppose the delivery of money or other assets at a specified future date; and
• trade 24 hours a day, 365 days a year.

Their contract terms and their trading and settlement structures therefore differ from those of conventional derivatives. The notice adds that many countries have not yet established a regulatory framework for these products and are restricting the services. Investors should not assume that a product is the same as, or similar to, a financial investment product traded on Korea’s securities markets simply because it is called a “futures” contract.

Leverage of 10x to 200x

The perpetual futures mainly traded today are linked to price movements of the underlying asset, such as a Korean stock index, at 10 times and up to 200 times. A small price move against the investor’s position can quickly lead to large losses.

The 0.66% example. The notice gives an example: for a product linked to a Korean stock index at 150 times, an intraday move of only about 0.66% against the position could trigger the forced liquidation of the entire investment. The higher the leverage, the faster and larger the losses, and investors may lose their full investment before they have time to post additional margin.

Not permitted in Korea. The authorities also note that, because of these speculative features, such products are not permitted under Korea’s regulatory framework.

Korean Investor Protection Is Unlikely to Apply

Derivatives traded in Korea’s financial markets are subject to entry regulation and investor protection rules under the Financial Investment Services and Capital Markets Act (자본시장법, “FSCMA”) and other laws. For example, individual investors who wish to trade exchange-traded futures and options in Korea must hold a minimum basic deposit (기본예탁금) and complete prior training and simulated trading.

Most offshore virtual asset platform operators, by contrast, are currently outside Korea’s regulatory framework. Trading through them does not offer the same level of protection as trading in Korea’s regulated financial markets. The notice specifically points to cases where:

• the offshore platform operator becomes bankrupt or suspends its business;
• the platform unilaterally suspends trading; or
• IT or financial incidents and disputes occur.

In these situations, legal resolution and remedies under Korean law are difficult to apply. Korean supervisors also have difficulty confirming whether customer assets are being properly protected and held.

Enforcement Against Offshore Platforms

The authorities will closely monitor the launch of products linked to the Korean stock market by offshore platform operators, and the impact of those products on the domestic market. Where an offshore platform operator is found to be conducting illegal business in Korea, the authorities plan to respond firmly, including by referring the matter to investigative authorities.

The notice gives the following as examples of illegal business activity in Korea:

• soliciting Korean residents to trade, such as by inducing new sign-ups through referral codes or by receiving fees; and
• cases where the related offshore products affect the Korean stock market.

The authorities also plan to ask major offshore platform operators that currently support perpetual futures trading related to the Korean market to cooperate so that no violations of Korean law occur. Whether similar products should be introduced in Korea, and how they would be regulated, will be reviewed carefully in light of their market impact, investor protection, and global discussions.

What This Means for Offshore Platforms and Investors

Offshore platforms. Korea-linked perpetual futures are now under active monitoring. Marketing aimed at Korean residents, including referral-code sign-ups and fee arrangements, is the type of conduct the authorities describe as illegal business activity in Korea. In our view, platforms that list products linked to Korean stock indices, or that have Korean users, should review their product offering and Korea-facing marketing against this notice.

Investors. For investors trading from Korea, including foreign nationals resident in Korea, trading these products on an offshore platform carries both high market risk and limited legal recourse in Korea if the platform fails, halts trading, or becomes involved in a dispute.

Cha & Kwon advises virtual asset businesses and foreign market participants on Korean regulatory compliance and market entry. Our team authored the South Korea chapter of the Chambers Blockchain & Crypto-Assets 2026 Global Practice Guide.

Related reading: Crypto Referral Marketing in Korea: When Promoting an Unregistered Exchange Becomes Aiding a Crime — the legal risk of promoting unregistered exchanges to Korean users.

Related reading: Korea’s Crypto Referral Programs and the VASP Line: What Foreign Operators Need to Know — how referral programs relate to VASP registration.

Related reading: Korea Crypto Law: Complete Legal Guide for Foreign Businesses & Investors — our hub covering VASP registration, CARF, STO regulation, and more.

Sources and further reading: FSC, KoFIU and FSS joint press reference on perpetual futures, October 16, 2026 (FSS website, Korean).

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Cha & Kwon Law Offices advises virtual asset businesses, fintech companies, and foreign investors on Korean regulatory compliance. For consultation, contact us at contact@chakwon.com or visit chakwon.com.

This article provides general legal information and does not constitute legal advice for your specific situation. Please consult qualified Korean legal counsel regarding your particular circumstances.

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