South Korea Enhances Crypto Regulation with Permanent Crime Unit

South Korea is set to embrace the importance of digital asset regulations and vigilance with the decision to turn its temporary crypto crime unit into a permanent one, according to a report from a local media outlet.

According to the Segye Ilbo report, the Ministry of Justice and the Ministry of the Interior and Safety plan to start talks in early May on the decision to transform the Joint Virtual Asset Crime Investigation Unit into an official department.

Importantly, the crypto crime unit currently operates as a makeshift body under the Southern District Prosecutor's Office in Seoul and could be scrapped from existence when deemed unnecessary. However, the report points out that officialdom will raise efficiency in the unit through the appointment of new prosecutors and budget allocation.

The Joint Virtual Asset Crime Investigation Unit, announced in July 2023, becomes the country's first one specifically for crimes in the rapidly growing but somewhat weakly controlled digital asset sector. It will have about 30 experts from seven financial and tax regulatory authorities.

According to the February report issued by South Korea's Financial Intelligence Unit, such crimes have been exploding in numbers in the region. In 2023, local firms reported 16,076 suspicious transactions, which represented a 49% increase from 2022. Moreover, the country is also set to debut its first comprehensive crypto regulation with the goal of protecting investors from the volatile nature of digital assets on July 19, according to a statement from the Financial Services Commission (FSC).