South Korea is looking at OTC crypto laws as black market transactions approach $4 billion

A study by the Korea Customs Service estimates that in 2018, criminals laundered $4 billion via illegal foreign exchange transactions using digital money.

Concerns about the potential for illicit usage of cryptocurrencies have prompted authorities in South Korea to shift their attention to OTC trading. The OTC cryptocurrency market is apparently being monitored by the country’s financial officials.

A local newspaper said that deputy chief prosecutor Ki No-Seong, Park Min-woo of the Financial Services Commission (FSC), and other important regulators went to a session on “Criminal Legal Issues Associated to Virtual Assets” that focused on the unregulated OTC crypto market. At the conference, No-seong argued that the OTC crypto market should be regulated because of money laundering risks.

According to Google’s translation, Seong said: Unauthorized electronic money Off-the-counter (OTC) businesses operate via overseas subsidiaries and facilitate the exchange of virtual money gained dishonestly for Korean won or foreign currencies. These firms need oversight since they are likely engaging in the illegal trade of virtual assets.

The “OTC crypto market” refers to the unregulated marketplace for digital currencies. Peer-to-peer (P2P) exchanges are included in the category of over-the-counter (OTC) transactions using digital currencies since they occur outside of regulated platforms. Upbit, the biggest regulated crypto platform in South Korea, offers a total of 172 different cryptocurrencies, whereas OTC platforms provide as many as 700 different cryptocurrencies, as stated in the research.

Several cases of exchanging digital assets for Korean won using OTC marketplaces were noted in the study.

According to the report, the three suspects were caught while obtaining digital currency from foreign OTCs at the request of Libyans and then shipping it to Korea to be converted into cash. According to the Korea Customs Service, the total amount of illegal foreign exchange transactions conducted using digital currency in 2022 was $4 billion (5.6 trillion won).

South Korea has a history of strict crypto regulation and has implemented many laws to combat crypto-related crime. Following Terra’s demise, the country’s regulators have taken a more active role.

Also Read: Robert Kiyosaki Reminds His Support For Crypto And Calls Fiat “FAKE”