South Korea’s Ministry of Justice announced its intention to create a crypto-tracking system to fight the flow of dirty money and other related financial transactions and recover cash related to criminal activities.
Recently, the governor of the country’s Financial Supervisory Service Lee Bok-hyun announced the government’s plan to create digital currency monitoring tools to secure data and combat market dangers.
It is believed that 2 million South Koreans, or about 4% of the population, currently own cryptocurrencies. According to government data, bitcoin and other related currencies account for one-third of illegal foreign exchange transactions in the country.
Image: Sungjin Kim/Getty Images
South Korea As Crypto Powerhouse
In the 12 years since the creation of Bitcoin, Asia has emerged as a digital currency and blockchain dynamo, with South Korea as its pivot.
The country’s main telecom provider, SK Telecom, introduced a web3 wallet, while the country’s largest financial technology company, Dunamu, aims to spend $380 million over the next five years to generate 10,000 new web3 jobs.
South Korea’s Ministry of Justice will introduce a “cryptocurrency tracking system” in the first half of this year to strengthen the tracking of money laundering and the recovery of criminal proceeds using cryptocurrencies. https://t.co/2CLkaLUrX6
— Wu Blockchain (@WuBlockchain) January 29, 2023
After the Terra-LUNA crisis, the government has expanded its controls and laws on cryptocurrencies as the number of people using them has increased.
Khgames, a local media site, said the virtual currency monitoring system will be used to monitor transaction history, extract data about transactions, and verify the source of cash before and during transmission.
Roughly translated, the ministry’s statement reads as follows:
“In response to the sophistication of crime, we will improve our forensic infrastructure. We will build a criminal justice system that meets international standards.
After the successful launch of the proposed tracking system, the Ministry of Justice announced that it will create a second tracking and analysis system in the second half of 2023. The deployment of the first system is scheduled for the first half of this year.
Next Project: National Digital Forensics Cloud System
Up to 30% of global cryptocurrency trade is supported by the Korean market. Since the government has not yet defined crypto assets as legal tender, it is now allowed to hold, sell, and buy cryptocurrencies in the country.
Crypto total market cap at $1 trillion on the daily chart | Chart: TradingView.com
Major entities such as Solana understand the country’s attributes not only as customers but also as developers in the crypto business. The Solana Foundation and Solana Ventures recently raised $100 million to invest in startup web3 in South Korea.
During the first half of this year, the Ministry of Justice also wants to build a “National Digital Forensic Cloud System.” The forensic cloud system will be designed after the digital forensic system (D-Net) so that other agencies can use it.
Previously, South Korean authorities made an agreement with five local exchanges to collaborate in criminal investigations, with the main goal of creating a safe trading environment for crypto investors.
A selection of images from UK Research and Innovation