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South Korea’s financial regulator launches system to monitor cryptocurrency fraud in real time
The regulator that oversees South Korea’s financial institutions is unveiling a new surveillance system for illicit cryptocurrency activity, as the country prepares to implement its first law to protect digital asset users.
In a new declarationThe Financial Supervision Service (FSS) says it has worked with local cryptocurrency exchanges to develop a 24-hour monitoring system for suspicious transactions in the cryptocurrency sector.
The system will become operational as soon as the Virtual Goods User Protection Act comes into force on July 19.
The new law aims to to forbid manipulation of the cryptocurrency market, certain types of trading activities and use of material undisclosed information relating to digital assets.
Violators of the new law face serious consequences, including life imprisonment for illicit profits exceeding 5 billion won (about 3.76 million U.S. dollars) and hefty fines of three to five times the amount earned from the violation.
The FSS is implementing a monitoring system with the aim of facilitating the compliance of cryptocurrency exchanges with their legal obligations.
“With the implementation of the Virtual Asset User Protection Act, unfair trading in the virtual asset market is prohibited, and the virtual asset exchange must keep a check on abnormal transactions.”
Asia’s fourth-largest economy is adopting the cryptocurrency user protection law in the wake of the $40 billion collapse in 2022 of Terraform Labs, a cryptocurrency ecosystem co-founded by South Korean national Do Kwon.
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