- The South Korean Ministry of Justice has decided to introduce a virtual currency tracking system.
- The authority intends to strengthen the tracking of money laundering and the recovery of criminal proceeds using cryptocurrencies.
- The tracking system would monitor the transaction details, including their sources, before and after the transactions.
South Korea’s Ministry of Justice announced on January 26, 2023, that the authority has decided to introduce a “Virtual Currency Tracking System,” adding to the series of crypto regulatory acts recently prevalent in the country.
The Chinese reporter Collin Wu, wrote on his Twitter account, Wu Blockchain, that the South Korean Ministry intended to “strengthen the tracking of money laundering and recovery of criminal proceeds using cryptocurrencies.”
Recently, Financial Supervisory Services (FSS) Governor Lee Bok-hyun of South Korea announced the country’s proposal to develop a cryptocurrency monitoring tool intended to secure data and confront the threats of digital markets.
Lee added that if the crypto markets grow rapidly without regulations, their impact on financial stability would be worse:
Despite the rise of the virtual asset market, the direct influence on financial system stability remains limited.
With the current declaration of the establishment of the Virtual Currency Tracking System, the country is moving forward to stronger crypto regulations, securing the future of the South Korean crypto market.
Significantly, the new implementation would focus on monitoring transaction details, fetching transaction-related information, as well as verifying the sources of transactions before and after the transactions.
In addition, the Ministry stated that it would invent a new tracking and analysis system after the successful administration of the current tracking system, by the second half of 2023.
Furthermore, the Ministry of Justice assured that
We will overhaul the forensic infrastructure (infrastructure) in response to the modernization of crime.
Notably, the Ministry has other plans to strengthen the country’s regulatory activities.For instance, the authority has plans to bring forward a “National Digital Forensic Cloud System” to reorganise the forensic investigation infrastructure.
Currently, the country’s crypto experts are preoccupied with criminal and cyber investigation sectors, delving into criminal cases involving the crypto space and tracking and investigating the details of virtual assets.
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