Key Takeaways
- The “Virtual Currency Tracking System” will mainly be used to monitor transaction history and extract relevant information.
- The Ministry to develop an independent tracking and analysis system in addition to the crypto tracking system by the second half of 2023
South Korea’s Ministry of Justice is now working on introducing a crypto-tracking system to tackle money laundering. The system called the “Virtual Currency Tracking System” will primarily be used to monitor transaction history, extract information related to transactions, and further check the source of funds before/ after the remittance.
As per local media reports, the Ministry also would develop an independent tracking and analysis system in addition to the crypto tracking system by the second half of 2023. Commenting on the development, the Ministry of Justice said, “We will overhaul the scientific investigation infrastructure (infrastructure) in response to the modernization of crime.”,
Reportedly, the Ministry of Justice announced that it would build a cloud system modeled after the prosecution’s digital forensic system (D-Net) so that other agencies can utilize scientific investigation and forensic know-how.
South Korea is now increasing its crackdown on crypto firms that fail to meet regulatory requirements. Following the implosion of FTX in November, Korea’s financial authority, Korea Financial Intelligence Unit (KoFIU), launched a probe into crypto exchanges in relation to listing their in-house, self-issued tokens.
South Korea’s top financial regulatory body, the Financial Services Commission (FSC), has made it mandatory for exchanges in the country to register with the FSC’s anti-money laundering enforcement arm, the Korea Financial Intelligence Unit (KFIU). Last year, the five biggest crypto exchanges in South Korea signed a “crypto crime-fighting” MOU deal with the nation’s police force – and will work with officers fighting crypto-powered money launderers and crypto scam artists.
The five trading platforms are the only exchanges that are currently licensed to operate in the fiat KRW markets, and all five have commercial banking partners. Earlier this month, the South Korean Supreme Court finalized its ruling that the South Korean crypto exchange Bithumb must pay damages to investors over a 1.5-hour service outage on Nov. 12, 2017.
