A new report has revealed that the rationale behind South Korea’s 2018 crypto crackdown played a featured role in ‘Crypto Winter’.
It has been reported that Digital Today discovered the “2017 Anti-Money Laundering Annual Report” which showed the Financial Intelligence Unit had identified more than half a million crypto transactions in South Korea in 2017 related to illegal activities.
However, the 519,908 crypto transactions were identified by authorities as “suspicious” and the upswing in money laundering fuelled the national government’s decision to carry out a partial crypto crackdown in 2018.
The report took several years to be made public, instead of being issued in November 2018.
The 2017 annual report said that one of the most prominent money laundering cases involved an undisclosed crypto exchange.
Likewise, the Financial Services Commission elaborated that the director, nicknamed “Mr. A” in the report, transferred money from his account to other exchange accounts after having received funds from traders within the exchange’s corporate accounts.
Later, he transferred the money to his relatives’ accounts by repeating the same type of transactions, reaching a total transferred amount of tens of “trillions” of Korean Won, as they reported that Mr. A ultimately managed to evade taxes in the country.
As per the report, that case and others led to South Korean financial watchdogs partially cracking down on virtual assets in 2018.
Thus, based on the 2019 report, the Financial Services Commission concluded:
“With the rise and diversification of the financial market base due to the emergence of Kagasan Mountain and Fintech, the money laundering crime using cryptos has increased not only in quantity, but also in terms of quality, and is becoming increasingly complicated.”