South Korea’s financial overseer has announced it will bolster monitoring of the cryptocurrency market and enforce tougher penalties on financial institutions for IT accidents, after high-profile events highlighted risks to market integrity and investor security.
On Monday, the Financial Supervisory Service (FSS) revealed its annual policy agenda, featuring intended investigations into risky crypto market activities and the implementation of punitive fines for IT infrastructure breakdowns in the financial industry, Yonhap news agency reported.
As a component of its digital asset oversight, the FSS indicated it will conduct specific investigations into actions that weaken market discipline.
These encompass price manipulation by major traders, or “whales,” and techniques such as artificially inflating prices of tokens whose deposits and withdrawals have been paused on certain exchanges. Per the report, other practices under the regulator’s lens include swift price-pumping schemes, market manipulation executed via application programming interface orders, and the dissemination of fabricated information through social media.
This regulatory action follows a recent mishap at Bithumb, South Korea’s second-largest cryptocurrency exchange. According to a BBC report, the exchange accidentally transferred 620,000 BTC, valued at about $44 billion, to hundreds of users during a Friday night promotional activity. Bithumb has said it has recovered 99.7% of the erroneously transferred Bitcoin.
