South Korea forms task force to tackle crypto crime

South Korea has launched a unit to tackle cryptocurrency crimes. The initiative is prompted by a spike in illicit activity in the digital-asset market and a lack of investor protection, Reuters reports.

The so-called unified interagency centre for crypto-crime investigations will be staffed by 30 personnel from judicial, financial, tax and customs authorities.

The prosecutors said the centre would fill the investor-protection gap until the digital-asset market is regulated by law.

The centre will focus on investigations into highly volatile cryptocurrencies, illegal trading practices, tax evasion, unauthorised transfers of foreign currency, concealment of criminal proceeds and money laundering.

According to the agency, over the past five years the damage from digital-asset–related offences — from price manipulation to illegal foreign-exchange operations and Ponzi schemes — has risen by 118% to KRW 1.02 trillion (KRW ($797.81 million)).

The number of transactions on local crypto exchanges suspected of being linked to crimes surged by 1,263% — from 66 in 2021 to 900 in 2022.

In June 2023, South Korea’s parliament passed a law protecting digital-asset users.

The document consolidated 19 distinct bills related to cryptocurrencies. It defined liability for offences such as insider trading, market manipulation and unfair trading practices.