South Korea’s Financial Supervisory Service (FSS) has announced a new plan aimed at restoring the order of the crypto market.
The plan focuses on regulating and reducing the risks that disrupt the process of trading cryptocurrency. It also focuses on tightening the oversight of financial institutions’ technological systems.
The report was released on Monday, the 9th of February, as part of the FSS’s annual policy direction. At the center of the initiative is a well-planned investigation by the authorities into the methods of manipulations that exist in the crypto space.
According to South Korea’s FSS, some of the methods that were used in the past to manipulate the market included the “big whale” manipulation system, where large amounts of money were used to influence the price of different assets.
Another method is the “fence” method that targets assets with suspended deposits or withdrawals, and finally, the “racehorse” method, which involves a rise in the token price spiked through bulk purchases at a specific moment.
Also Read: South Korea Advances Digital Asset Bill Toward Formal Submission
Another high-risk manipulation method the officials are watching closely is price manipulation using market API orders and other fraudulent trading schemes that rely on sharing false information through social media.
To address these manipulation methods, the FSS plans to develop systems that automatically detect any form of suspicious trading patterns by analyzing price movements on a second-by-second and minute-by-minute basis.
The regulator also plans to introduce artificial intelligence-based text analysis tools to help identify any form of coordinated manipulation groups. These tools are expected to strengthen and monitor the market in real time.
South Korea’s FSS Plans to Strengthen the Financial Crime Enforcement
Another key focus of the new plan is to enhance enforcement against financial crimes that harm the public. This law aligns with President Lee Jae-myung’s emphasis on completely eradicating what he described as “cruel financial practices.”
The FSS plans to promote the creation of a special judicial police consultative body dedicated to helping individuals who fall victim to any kind of financial scam. This is done in order to improve on-site response and also investigative coordination.
In addition, the Illegal Financial Transaction Reporting Center will be expanded and reorganized to provide counseling for victims. For voice phishing cases, there would be a cooperative system with the police that would allow investigations to begin immediately after victims show proof of loss, and also there would be preparations for a damage compensation system.
Also Read: Bitcoin (BTC) Whales Accumulate $4.7B BTC During Market Dump
