According to Cointelegraph: South Korean regulators are escalating their scrutiny of over-the-counter (OTC) cryptocurrency transactions in the face of rising concerns about their utilization for criminal activities. Illegal foreign exchange transactions using digital currencies were estimated at around $4 billion last year, according to the Korea Customs Service Report.
A session focusing on “Criminal Legal Issues Related to Virtual Assets” was attended by key regulatory personnel including Ki No-Seong, Deputy Chief Prosecutor, and Park Min-woo from the Financial Services Commission (FSC). The session specifically concentrated on the unregulated OTC cryptocurrency marketplace.
No-Seong advocated for the regulation of the OTC crypto market, citing money laundering concerns. The term “OTC crypto market” usually refers to exchanges not officially recognized by the government, encompassing all transactions outside regulated platforms, including peer-to-peer (P2P) exchanges.
The largest regulated crypto platform in South Korea, Upbit, supports approximately 172 cryptocurrencies, whilst OTC platforms offer around 700. The report also outlined cases where OTC platforms were employed illicitly to convert digital assets into Korean won, leading to several arrests and indictments.