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South Korean Prosecution Vows to ‘Review’ Crypto Sector as Scandal Intensifies

Tim Alper
Last updated: | 1 min read
Piles of metal tokens intended to represent Bitcoin on a South Korean flag.
Source: Alexey Novikov/Adobe

South Korea’s Prosecutor-General has promised a “thorough review” of the crypto sector amid rising “public suspicion” about politicians and their crypto holdings.

Per Yonhap, Prosecutor-General Lee Won-seok said his agency would “faithfully investigate” the sector.

And he pledged to “resolve public suspicions about cryptoassets.”

Lawmakers and prosecutors are attempting to fight a wave of outcry sparked by the Coin Gate scandal.

Earlier this month, a leading MP was reportedly found to have traded coins with “insider knowledge” of forthcoming crypto regulations.

A range of other allegations has also been made about the MP, Kim Nam-kuk.

But some feel Kim may not be the only lawmaker to have alleged crypto-related secrets.

Lee distanced himself from crypto, saying:

“I have never owned stocks or cryptoassets. That will not change in the future.”

Speaking to media representatives outside the Suwon District Prosecutor’s Office, Lee said that prosecutors would tackle issues such as “token listings on exchanges.”

Several leading crypto exchange officials have this year been charged with price manipulation.

It has emerged they allegedly took bribes in exchange for listing tokens on their platforms.

In South Korea, altcoin prices tend to spike sharply when news of listing on a major domestic platform is announced.

Some are thought to have artificially engineered these spikes by paying officials to fast-track their coins’ listing processes.

A graph showing trading volumes on Bithumb, one of South Korea’s most popular crypto exchanges.
Trading volumes on Bithumb, one of South Korea’s most popular crypto exchanges. (Source: CoinGecko)

South Korean Prosecution Responding to Crypto Scandal?

Lee pledged to investigate crypto-related “investment problems.”

And he said he would resolve a range of crypto-related “speculation problems.”

Seoul has also been rocked by allegations that senior lawmakers oversaw crypto-powered “remittances” to North Korea-linked parties.

Lee claimed that he would be guided by “the evidence” available and “deal” with possible legal infringements “according to the law.”

The Prosecutor-General further claimed that prosecutors would continue to tackle the “drug problem.”

President Yoon Seok-yeol last month declared “all-out war” on crypto-powered drug trafficking as an increasing number of narcotics-trading teens have been handed jail sentences.

Public figures have called on all lawmakers and regulators to declare their crypto holdings.