South Korea is taking steps to enhance its crypto regulatory framework to tackle the increasing number of cryptocurrency-related crimes and safeguard investors.
In a recent report, it was announced that an interagency investigation unit, the Joint Investigation Centre for Crypto Crimes, has been established to crack down on illicit activities in the virtual asset market.
Concurrently, the Korea Securities Depository has partnered with Code to encourage the use of Legal Entity Identifier (LEI) in the crypto market, promoting transparency and accountability.
The Joint Investigation Centre for Crypto Crimes, led by the Seoul Southern District Prosecutors Office, is a joint effort by seven government agencies and bodies.
Comprising 30 investigators, the unit aims to investigate market players engaged in issuing or distributing cryptocurrencies, focusing on detecting irregular trading activities and probing associated criminal acts.
The unit will expedite the investigative process, covering the detection, analysis, and handling of crypto-related criminal cases.
The launch of the crime investigation unit coincides with the passage of South Korea’s first-of-its-kind legislation at the National Assembly.
The new law is designed to protect crypto investors and introduces penalties, including prison sentences and fines, for individuals involved in unfair trading practices, manipulation of market prices, and illicit transactions concerning virtual assets.
In partnership with Code, the Korea Securities Depository is promoting the adoption of Legal Entity Identifier (LEI) in the virtual asset market.
LEI is a standardized ID given to corporations worldwide participating in financial transactions. Its introduction is aimed at the efficient management of financial transaction information following the 2008 financial crisis.
The agreement with Code encourages virtual asset operators to obtain LEIs for reporting and supervising due diligence, improving transparency and accountability.
The adoption of LEI will replace the Foreign Investment Registration Certificate in December, further bolstering transparency in the crypto market.
