Cracking Down on Crypto Crime: Authorities Uncover First Unfair Transaction Under New Virtual Asset Act

According to the industry, the financial authorities (Financial Services Commission and Financial Supervisory Service) announced on the 1st that they completed the investigation into a case suspected of unfair trading (market manipulation) in the virtual asset market on the 25th of last month and notified the prosecution according to emergency measures procedures.

In this market manipulation case, the suspect submitted a large purchase order at a high price for the purpose of selling coins received from an overseas virtual asset issuing foundation at a high price on the domestic virtual asset exchange, and then placed the order through API (Application Programming Interface) when certain conditions were met. It is a typical price manipulation method that continuously and repeatedly submits imaginary buy orders through (automatic trading programmed to submit and cancel) and artificially changes the market price and trading volume, causing general users to mistakenly believe that a large amount of buying power has flowed into the coin. lost

Imaginary buy orders were submitted hundreds of thousands of times a day by submitting buy orders at a certain percentage lower than the current price, and then canceling them before they were concluded when the price of the virtual asset fell. Through this, the amount of illegal profits obtained by the suspect was found to be in the billions of won.

In order to quickly establish trading order in the virtual asset market, financial authorities are quickly investigating cases of suspected unfair trading notified by the virtual asset exchange. In this case, the investigation was completed in about two months after receiving notification of the trial results from the exchange. In particular, during this process, the financial authorities quickly completed the investigation by using their own investigation infrastructure, such as a large-capacity trading data analysis platform, and forwarded the case to the prosecution through the ‘Fast Track’ so that the prosecution’s follow-up investigation can be carried out quickly. notified to