A crypto investigation unit has been established in South Korea to counter illegal activity in the digital asset sector.
According to a Reuters article, the Joint Investigation Centre for Crypto Crimes comprises a group of about 30 experts from several fields, including the legal, financial, tax, and customs sectors.
Compared to traditional equities regarding investing relevance, virtual assets frequently lack adequate legal protections, leaving market participants vulnerable to fraud.
The Prosecutors’ Office saw how urgently this regulatory gap needed to be filled. It highlighted that the group would safeguard investors until more extensive laws and procedures could be implemented to regulate the cryptocurrency sector.
The investigation team will concentrate on cryptocurrencies with considerable price volatility due to the complexity of crypto crimes. The authorities consider them to be the perfect environment for illegal trade, tax evasion, unauthorized currency exchanges, the covert buildup of criminal gains, and large-scale money laundering schemes.
Crypto crimes in South Korea
The cost of cryptocurrency-related crimes has risen in South Korea over the last five years, rising by 118% to a staggering 1.02 trillion won ($797.81 million) in 2022.
Although other illegal activities fall under the broad category of financial fraud, price fixing, and Ponzi schemes are two of the more well-known examples.
The South Korean cryptocurrency market had a disappointing 66% year-over-year decrease compared to the spectacular spike in value it experienced the year before.
A confluence of international and domestic events that worsened investor sentiment and rising interest rates threw the market into a tailspin. The so-called stablecoin TerraUSD and its companion Luna’s catastrophic collapse in May 2022 shocked the nation.
Accusations of fraud against Do Kwon, the creator of these fatal currencies, intensified the subsequent public outcry. Kwon tried to escape prosecution but was apprehended by the law in Montenegro, where he sought asylum.
He is also currently being accused of many counts of fraud in the US. The government wants to make it plain to criminals and would-be wrongdoers that they cannot get away with their illicit actions by combining the resources of many groups. I hope that the inquiry team will offer the security and accountability the world needs as it starts its job.
