In recent years, the cryptocurrency industry has witnessed numerous illicit activities, such as illegal trading and market manipulation. In response to these issues, the South Korean government is set to implement a new consumer bill in July of this year. The aim is to curb the rise of crypto-related crimes and enhance investor protection.
South Korea’s new consumer protection bill
According to the bill, individuals engaged in illicit activities could face life imprisonment in South Korea. In addition to this legislative effort, the Financial Services Commission (FSC) proposed the Virtual Asset User Protection Act in December 2023. This act considers individuals as crypto criminals if they are found involved in market manipulation, illegal trading, money laundering, crypto-jacking, fake exchanges and wallets, or terror financing.
The FSC highlights that, apart from life imprisonment, crypto criminals may also be subject to fines ranging from three to five times the amount of unjust enrichment. Life imprisonment is only pursued if the crime exceeds $3.8 million.
Several moves toward crypto criminals by the South Korean government highlights that the safety of investors is a top priority. Which will benefit not only investors but also crypto firms operating in the country. A commitment to strengthening the digital asset industry and protecting investors is evident in South Korea’s actions.
South Korea’s action over crypto criminals
As an example, South Korea recently sentenced Do Kwon’s ex-financial officers to life imprisonment for their role in the collapse of the Terra stablecoin, resulting in a loss of over $60 billion. Both the co-founder and the former financial officer were arrested at the International Manhunt airport as they attempted to escape with fake documents.
Furthermore, in response to North Korean crypto criminal activity, which involved the theft of over $2 billion worth of cryptocurrency in the last five years, top national security officials from the U.S., South Korea, and Japan convened in Seoul on December 8, 2023, to discuss North Korea’s illicit activities.
The trilateral talks also addressed North Korea’s relationship with Russia, adding another layer of complexity to the geopolitical landscape. According to a recent report, the majority of North Koreans are continuously utilizing the Russian cryptocurrency exchange to launder their crypto. This move by the South Korean government aims to attract crypto businesses and establish itself as a global crypto hub.
