South Korean regulators are set to launch extensive investigations into unfair cryptocurrency transactions. The Financial Services Commission (FSC) announced on July 7 that it will establish an investigation system that will commence operations on July 19. This coincides with the implementation of the Virtual Asset User Protection Act. The FSC will collaborate closely with the Financial Supervisory Service (FSS) to investigate unfair virtual asset transactions, including those involving undisclosed information and price manipulation trading. The regulators will also target companies and individuals suspected of trading self-issued coins for personal gain. They will analyze data received from crypto exchanges and rely on reports submitted through the FSS’s new reporting center. Additionally, the FSC will utilize its own monitoring systems to probe transactions and cooperate with overseas regulators and foreign crypto exchanges. The regulator will investigate suspicious cross-border transactions, hacking incidents, and anonymous transactions. Furthermore, the FSC will verify the claims of crypto operators who allege they have been victims of hacking attacks. Offenders convicted of unfair crypto trading practices will face penalties such as fines, warnings, cautions, and imprisonment for over one year in serious cases. The regulator will introduce a system of fines, with offenders ordered to pay three to five times the amount earned through unfair methods. More severe offenders could receive jail sentences of up to five years, while the most egregious cases could result in life imprisonment. The investigation system will be activated immediately on July 19, according to a Financial Services Commission official.
