Billions in Stolen Riches: The Dark Side of Virtual Assets Exposed in Landmark Unfair Trade Bust
Domestic financial authorities have completed the first measure against unfair trading of virtual assets since the implementation of the Virtual Asset User Protection Act (hereinafter referred to as the Virtual Asset Act).
The Financial Services Commission and the Financial Supervisory Service announced on the 1st that they had notified the prosecution after completing an investigation into an alleged case of unfair trading (market manipulation) in the virtual asset market on the 25th of last month. Since the implementation of the Virtual Asset Act on July 19, this is the first case of unfair trade measures notified to the prosecution after uncovering abnormal transactions on virtual asset exchanges and investigating by financial authorities. The Virtual Assets Act stipulates that unfair trading practices, such as market manipulation, will result in imprisonment of more than one year or a fine of 3 to 5 times the amount of unfair profits.
According to the authorities, the suspect who was caught repeated the act of placing and canceling purchase orders for virtual assets at a high price on the exchange in order to sell them at a high price. In this process, we used an API program that automatically executes orders when certain requirements are met. Financial authorities said, “This is a typical market manipulation that deceived people into thinking that there was a large influx of purchase orders for the virtual asset in question,” and added, “The suspect made billions of won in unfair profits.”
Financial authorities completed the investigation in about two months using their own infrastructure, including a large-capacity sales data analysis platform. In addition, the case was notified to the prosecution through the ’emergency action procedure (fast track)’ to ensure that the follow-up investigation proceeds quickly.
Financial authorities plan to mobilize all means to investigate unfair trading practices to establish a sound trading order in the virtual asset market. Financial authorities said, “We will monitor virtual asset exchanges to ensure that abnormal transactions are detected and psychology operates smoothly.” If you suspect unfair trading practices such as market manipulation or illegal trading, you can report it to the ‘Report Center’ on the Financial Supervisory Service website.