- South Korea’s Financial Services Commission reports freezing $61 million in crypto since 2019
- Freezes targeted telecom fraud linked to Bithumb and violations of the User Protection Act
- Actions across Bithumb, Coinone, Korbit, Gopax show sustained regulatory enforcement
South Korea’s Financial Services Commission (FSC) disclosed it has frozen approximately $61.4 million worth of cryptocurrency assets across various trading platforms over the last six years. This cumulative figure, revealed in a report submitted to lawmaker Wi Seong-gon’s office, underscores the regulator’s persistent efforts to combat illicit activities and enforce compliance within the nation’s rapidly evolving digital asset sector. The freezes stem primarily from suspected fraud and violations of the Virtual Asset User Protection Act.
FSC Data Reveals $61.4M Crypto Freeze Targeting Fraud, Act Violations
Details of the submitted report show that the frozen assets include those affected by the suspension of withdrawals imposed on crypto assets worth $37.4 million on Bithumb in 2020. The Bithumb withdrawal suspension was connected to 8,666 cases of telecommunications financial fraud.
Between 2020 and September of this year, the FSC has frozen digital assets valued at $18.9 million across 30,106 cases. Meanwhile, other cases of frozen assets by the South Korean regulator, linked to the Virtual Asset User Protection Act, include $4.4 million, which the Commission blocked on the Coinone exchange across 755 cases, and $296,000 frozen on Korbit, involving 529 cases.
Related: South Korea’s $350B U.S. Deal Stalls on Cash Timing as Tariffs Test KRW, Crypto
According to the submitted report, the FSC froze another $222,000 on the Gopax exchange, which involved 280 cases of non-compliance with the established rules within the region. The record over the past six years highlights the South Korean government’s efforts toward sanitizing its cryptocurrency sector amid ongoing evolution.
Understanding South Korea’s Tightening Crypto Regulatory Framework
In the meantime, it is crucial to note that the Virtual Asset User Protection Act is one of South Korea’s two main regulatory requirements for crypto exchanges, with the other being the Act on Reporting and Use of Specific Financial Transaction Information. The latter mandates exchange registration, strict anti-money laundering (AML) measures, and a real-name account system linked to verified bank accounts.
Recently, the Asian nation updated its requirements to cover more areas, including Travel Rule, Investor Protection, Interest Rate and Lending, Stablecoins, and Mining, creating a more robust regulatory structure for its digital assets sector.
Related: South Korean Lawmaker Presses Regulator on GOPAX Compensation Post-Binance Deal
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