South Korean authorities have seized approximately $3.2 million worth of cryptocurrency, including Ethereum, in an ongoing investigation into a large-scale illegal foreign exchange operation.
According to Yonhap News Agency, the Busan Western District Prosecutors’ Office raided a group suspected of operating an unauthorized money exchange business over a six-year period. The operation allegedly handled nearly 943.4 billion won (about $683 million) in illegal currency transactions, earning 25.7 billion won (around $18.6 million) in commissions, as per reports.
On June 26, prosecutors indicted two currency exchange firms and three individuals without detention. The charges include violations of the Foreign Exchange Transactions Act and the Electronic Financial Transactions Act. Authorities shared that the suspects facilitated money exchanges using platforms such as Nettel Pay, which is widely used on offshore gambling sites and in foreign exchange (FX) margin trading.
Prosecutors said the group collected the sum from individuals in South Korea and used online payment systems to recharge various currency accounts abroad. Through this method, they profited from transaction fees by bypassing regulatory scrutiny.
Further investigations revealed that at least three unregistered money changers were involved. These operators allegedly used fraudulent exchange methods to conceal the scale and nature of the transactions. In an effort to evade law enforcement, the suspects reportedly hid crypto assets in personal digital wallets under different names.
Authorities managed to trace and recover approximately 12.4 billion won in assets held under aliases, and confiscated 4.4 billion won (roughly $3.2 million) in Ethereum.
“This operation was conducted through thorough account and virtual asset tracking, combined with targeted search and seizure efforts,” said a prosecution official.
South Korea continues to struggle with a surge in crypto-related crimes. Just recently, a local court sentenced three men in connection with a $416,000 crypto fraud scheme.
In response to growing risks in the digital asset sector, South Korea is advancing regulatory reform. The government is currently reviewing the “Digital Asset Basic Act”, a proposed bill aimed at creating a legal framework for digital assets, particularly stablecoins tied to fiat currencies like the KRW or USD.
According to the Bank of Korea, South Koreans held a combined $74.5 billion in crypto assets as of the end of last year. With huge crypto adoption prevalent in the country, the need for regulatory measures has become more pressing than ever.
