As an analyst with a background in financial regulation, I’m deeply concerned about the recent revelation that 70% of shuttered cryptocurrency exchanges in South Korea failed to return investors’ funds. This is a stark reminder of the hidden risks associated with investing in lesser-known digital assets, especially in unregulated markets.
As a crypto investor in South Korea’s vibrant market, I was taken aback by the recent announcement from our financial regulators. In collaboration with the Financial Supervisory Service (FSS) and the Korea Financial Intelligence Unit (FIU), they revealed a disconcerting fact: an alarming 70% of defunct cryptocurrency exchanges have left their clients in the lurch, refusing to return their invested funds.
The Hidden Risks Of Lesser-Known Coins
This news comes as a gut punch to over 6 million Koreans, roughly 10% of the population, who have dipped their toes into the crypto pool. Unlike their global counterparts, Korean investors are known to dabble in riskier, lesser-known cryptocurrencies in addition to established names like Bitcoin.
The report presents a bleak scenario regarding the industry’s business methods. Several collapsed platforms failed to alert users prior to shutting down, forcing them into frantic efforts to save their investments. In instances where advance notice was given, the process for requesting withdrawals was characterized as an “unnecessary hassle,” with a minimal workforce on hand to manage a potentially large volume of requests.
Approximately 7 out of 10 cryptocurrency exchanges based in South Korea have been unable to refund investors’ funds following their closure or suspension, as reported by financial regulators on Friday (Korea Times).
— Financial Services Commission – FSC Korea (@FSC_Korea) June 7, 2024
Stern Warning To CEOs
The Financial Stability Supervisory Committee (FSS) is making efforts to restore confidence in the digital asset market. They plan to collaborate closely with other regulatory bodies to establish more stringent measures for shutting down financial institutions, with a focus on crypto exchanges. Moreover, they have delivered a strong message to the heads of digital asset service providers, urging them to adhere to the upcoming Virtual Asset Investor Protection Law, which is scheduled to commence in July.
The allure of significant profits in the unregulated cryptocurrency market is hard to ignore. However, it’s essential to acknowledge the growing risks that come with this territory. As regulatory bodies like the Financial Services Commission (FSS) strive to establish guidelines, Korean crypto investors need to exercise caution to avoid getting swept up in potential market turbulence or crashes.
Police Bust South Korean Scammers
Recently, South Korean authorities apprehended 19 individuals involved in a fraudulent “crypto reading room” scheme. This scam deceived more than 300 investors, resulting in losses totaling $19 million. The criminals used platforms like Telegram to impersonate crypto experts and entice victims with alluring advice and counterfeit endorsements.
In their deceitful scheme, they employed counterfeit apps connected to sham exchanges, alluring unsuspecting victims with initial profits. Subsequently, they imposed fake “withdrawal fees” and severed contact. The probe further exposed an alarming hiring technique named “pig-butchering.” Victims were lured with offers of employment in Myanmar only to be coerced into participating in the fraudulent activities upon arrival.
Read More
- BTC PREDICTION. BTC cryptocurrency
- LUNC PREDICTION. LUNC cryptocurrency
- BCH PREDICTION. BCH cryptocurrency
- MNT PREDICTION. MNT cryptocurrency
- Best Goomba Characters In Mario Games, Ranked
- USD RUB PREDICTION
- SOL PREDICTION. SOL cryptocurrency
- USD COP PREDICTION
- USD PHP PREDICTION
- Rumor: One of the Weirdest Games of 2014 Could Be Making a Comeback
2024-06-08 16:14