Hassan Maishera
TL;DR
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South Korea is set to tighten crypto regulation, targeting market manipulation.
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The FSS is set to impose tougher penalties on financial firms for IT-related accidents.
South Korea’s FSS to Tighten Crypto Market Oversight
South Korea's financial watchdog, the Financial Supervisory Service (FSS), announced on Monday that it will step up oversight of the cryptocurrency market and impose tougher penalties on financial firms for IT-related accidents.
This latest development comes following high-profile incidents that exposed risks to market integrity and consumer protection.
According to the Yonhap news agency, the regulator unveiled its annual policy agenda earlier today, which includes planned investigations into high-risk practices in the crypto market, alongside the introduction of punitive fines for IT infrastructure failures across the financial sector.
Furthermore, the FSS said it will conduct targeted probes into activities that undermine market order, including price manipulation by large traders, as well as tactics such as artificially inflating prices of tokens whose deposits and withdrawals have been suspended on specific exchanges.
The regulator will also scrutinize rapid price-pumping schemes, market manipulation using application programming interface orders, and the distribution of false information through social media.
The regulatory scrutiny comes shortly after an incident at Bithumb, South Korea's second-largest crypto exchange, which mistakenly transferred 620,000 BTC, worth roughly $44 billion, to hundreds of users during a promotional event on Friday evening.
The crypto exchange stated that it has recovered 99.7% of the mistakenly transferred bitcoin. However, the event resulted in a regulatory alert in the country.
