April 29, 2024 — In response to a marked increase in cryptocurrency-related crimes, South Korea is taking a significant step by making its temporary crypto investigative unit a permanent fixture. This move comes as the nation’s Justice Ministry and the Ministry of the Interior and Safety prepare to begin discussions in early May to upgrade the Joint Virtual Asset Crime Investigation Unit into an official department.
The Joint Virtual Asset Crime Investigation Unit, initially a temporary organization under the Seoul Southern District Prosecutor’s Office, is comprised of approximately 30 experts from seven financial and tax regulatory authorities.
The upgrade of this unit to a permanent department aims to provide a stable and ongoing response to the rising tide of digital asset crimes. The unit’s elevation from a temporary to a permanent status will help ensure continuity in its operations and enhance its capacity to tackle complex cryptocurrency-related criminal activities.
Discussions to formalize the unit’s status are scheduled to start in early May 2024. This strategic move aligns with the upcoming implementation of South Korea’s first comprehensive crypto regulations, set to take effect on July 19, 2024.
The unit operates within South Korea, with its base at the Seoul Southern District Prosecutor’s Office. The focus is nationwide, addressing crypto-related criminal cases across the country.
The initiative to make the investigative unit a permanent entity is driven by a significant increase in crypto-related crimes in South Korea. In 2023, local crypto companies reported 16,076 suspicious transactions, marking a 49% increase from the previous year, according to a February report from South Korea’s Financial Intelligence Unit. The rise in such activities necessitates a dedicated and permanent response team to address and mitigate these threats effectively.
By transitioning the Joint Virtual Asset Crime Investigation Unit to a permanent department, South Korea aims to bolster its legal and regulatory framework to combat cryptocurrency crimes more effectively. The forthcoming crypto regulations, which include stricter penalties and potentially life sentences for severe offenses like market manipulation, signify a robust approach to safeguarding investors and maintaining market integrity.
This development reflects South Korea’s proactive stance in adapting its legal and enforcement mechanisms to the evolving challenges posed by digital currencies and the crimes associated with them.
