South Korea Launches Multi-Agency Unit to Combat Crypto Crime and Safeguard Investors

South Korea Launches Multi-Agency Unit to Combat Crypto Crime and Safeguard Investors

South Korea is intensifying its efforts to combat crypto crime by establishing a specialized multi-agency unit dedicated to investigating virtual asset-related offenses. The primary objective of this joint virtual asset crime investigation unit is to protect investors’ interests while awaiting comprehensive regulations for the crypto industry.

Headquartered at the Seoul Southern District Prosecutors’ Office, the Joint Investigation Centre for Crypto Crimes will be staffed by 30 investigators drawn from various government agencies, including the prosecution, the Financial Supervisory Service, the National Tax Service, and the Korea Customs Service.

In a statement, the Prosecutor’s Office emphasized the importance of addressing the legal gaps surrounding virtual assets. With daily trading volumes exceeding 3 trillion won (~$2.35 million) and over 6 million participants, virtual assets have become comparable to stocks as investment products. However, due to incomplete laws and systems, market participants are currently left vulnerable without adequate legal protection.

To fill this regulatory void and safeguard investors, the Prosecutors’ Office will actively assume responsibility for protecting participants in the crypto market until comprehensive regulations are in place. A key objective of the unit is to streamline the investigative process for crypto-related criminal cases, from detection to analysis, adopting a fast-track approach to achieve more efficient case handling and help reduce illicit activities within the cryptocurrency space.

The investigative team will focus on cryptocurrencies that exhibit high price volatility or are at risk of de-listing. Their efforts will also be aimed at combating illegal trading practices like market manipulation and insider trading, which take advantage of the volatile nature of certain cryptocurrencies.

Moreover, the unit will meticulously investigate cases of tax evasion associated with crypto transactions, unauthorized foreign exchange transfers, and attempts to conceal criminal profits. Particular attention will be given to detecting and preventing money laundering, as cryptocurrencies can potentially be exploited to obscure the origins of illicit funds.

In conclusion, South Korea’s new multi-agency joint virtual asset crime investigation unit represents a significant step towards enhancing security and regulation in the cryptocurrency realm, bolstering investor confidence, and curbing unlawful activities within the market.