South Korea Mulls Permanent Status for Crypto Crime Investigation Unit
Summary:
South Korea is considering making its cryptocurrency crime investigation unit a permanent fixture within its administrative structure, according to local media. The unit, presently temporary and formed in July, comprises around 30 specialists and coordinates the activities of seven government agencies. This move signals the country's commitment to imposing order on its cryptocurrency market, notably after a significant increase in suspicious transactions and reported crypto-related crimes in 2023. This year has seen tightened rules for token listing on local exchanges and plans to shut down non-compliant exchanges. Cryptocurrency has also become a political matter, with major parties pledging to relax constraints ahead of parliamentary elections.
South Korean authorities are reportedly looking to upgrade their special unit investigating cryptocurrency-related crimes, giving it a permanent status in the administrative structure, as per local media outlets. Matters like assigning a budget and deputizing prosecutors will be discussed in the forthcoming month, as stated by Segye Ilbo. The current personnel of the unit are linked to the Prosecutors’ Office of the Southern District of Seoul. The team, which was established in July, consists of roughly 30 specialists and is operationally temporary, implying that the government could disband it at any time.
This special unit oversees the operations of seven state entities, including the Financial Supervisory Service, the Prosecutor’s Office, the Financial Intelligence Unit (FIU), and the National Tax Service. Additionally, a stable and permanent department would collaborate on equal terms with domestic and global governmental bodies and is likely to face a surge in workload once the Virtual Asset User Protection Act takes effect on July 19. The legislation anticipates severe penalties for cryptocurrency-related offenses exceeding more than 5 billion won ($3.6 million), including lifelong imprisonment.
The number of regulatory actions taken against virtual currency-related offenses has already started to increase. In 2023, there were 16,076 allegations of questionable transactions, reflecting a 48.8% year-on-year enhancement. Reports to law enforcement about potential crypto-linked crimes also showed a substantial 90% surge.
South Korea is introducing numerous initiatives to regulate its domestic crypto marketplace. Earlier this year, the country tightened listing prerequisites for tokens on local exchanges and declared intentions to intensify oversight of exchanges, taking definitive action against non-compliant ones. Cryptocurrency regulation has also become a matter of political debate. Major political factions are committing to lessen constraints in the lead-up to this year's parliamentary elections. President Yoon Suk Yeol's administration, which came into power in 2022, postponed the application of a 20% tax on crypto capital gains from 2023 to 2025, while concurrently placing an enhanced emphasis on levying taxes on cryptocurrency.
Published At
4/29/2024 10:30:00 PM
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