The regulator that oversees South Korea’s financial institutions is unveiling a new monitoring system for illegal crypto activities as the country prepares to enforce its first law protecting digital asset users.
In a new rackthe Financial Supervisory Service (FSS) says it has partnered with local crypto exchanges to develop a 24-hour monitoring system for suspicious transactions in the crypto space.
The system will become operational once the Virtual Asset Protection Law comes into force on July 19.
The aim of the new law is prohibit crypto market manipulation, certain types of trading activities and the use of undisclosed material information about digital assets.
Violators of the new law face serious consequences, including life imprisonment for illegal profits exceeding $5 billion, or approximately $3.76 million, and stiff fines ranging from three to five times the amount of the violation is earned.
The FSS is introducing a monitoring system with the aim of facilitating compliance by crypto exchanges with their legal obligations.
“With the enforcement of the Virtual Asset User Protection Act, unfair trading in the virtual asset market is prohibited and virtual asset exchanges must conduct an audit for abnormal transactions.”
Asia’s fourth-largest economy is adopting the law to protect crypto users following the 2022 collapse of Terraform Labs worth $40 billion, a crypto ecosystem co-founded by South Korean national Do Kwon.
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