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South Korean Police Forces to Form Dedicated Crypto Teams

Tim Alper
Last updated: | 1 min read
Source: iStock/vanbeets

Over a dozen South Korean police forces are set to launch dedicated crypto investigation units – and are standing by to deal with the fallout from a wave of shutdowns that is expected to sweep through the nation’s crypto exchange sector in the coming weeks.

Per EDaily and Money Today, the National Police Agency confirmed that it had sent letters to 18 larger local forces, telling each of them to create a “new team dedicated to crypto-related illegal incidents.

The reports stated that the police force is braced for “the possibility of a sharp increase” in various illegal, crypto-linked activities, including “unreported sales and embezzlement” in the next few weeks. The police, per the reports, “expect a glut of crypto exchanges” that fail to obtain operating permits from the regulatory Financial Services Commission (FSC) before the latter’s September 24 deadline, will close in the days ahead, leading to a raft of complaints from disgruntled customers.

There are around 100 exchanges in South Korea, but thus far only one has submitted the relevant paperwork to the FSC.

Any unlicensed exchanges operating after September 24 will face criminal charges.

The police forces are expecting to deal with dozens of cases of exchanges that fail to return their clients’ tokens and fiat, with a number of trading platforms already failing to respond to withdrawal requests.

In May of this year, the police also formed a crypto task force, headed by the deputy chief of the National Police Agency, and charged with “responding to illegal activity related to cryptocurrency.”

The new units will also be tasked with responding to a steep rise in crypto-related fraud cases with multi-million dollar scams starting to become more common and sophisticated than ever in South Korea.

Officers elsewhere in the world have hinted that they run the risk of becoming overwhelmed by crypto-related crime. In May this year, the Ukrainian cyberpolice chief Oleksandr Grinchak urged Kyiv to “legalize” crypto, complaining that the entire online “black market” now runs on cryptoassets.

He stated that “all crimes the police force deals with now can be associated with cryptocurrency,” with the exception of “trademark and copyright infringement.”
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