Hacks, data breaches, information leaks and scam projects have permanently stained the crypto sphere’s reputation. On top of causing heavy reputational damage, these crypto-related crimes have also caused quite a bit of financial damage.
The South Korean Justice Ministry estimated that crypto-related crimes were responsible for nearly $2.3 billion financial damage between 2017 and 2019 alone.
The Korea Herald reports that between the last 2 years, 132 crypto-related criminals, scammers and frauds have been indicted and detained. Additionally, 288 more criminals did not face physical detention and were simply fined or questioned by the authorities in question.
Crypto-related crimes will keep increasing until there are harsher measures taken
According to the report, Park Sang-kim, the South Korean Justice Minister ordered stricter measures to be taken against crypto-related crimes and criminals. Sang-kim believes that the lack of clear regulations on crypto exchanges has allowed countless anonymous accounts to remain at large.
The problem is, that anonymous crypto exchanges were banned way back in January 2018. Minor exchanges however, have reportedly started to use the “beehive” accounts which basically invalidates the entire ban.
These beehive accounts are employed by exchanges to keep user funds on their corporate bank accounts. A lot of other businesses actually do this, but the flip side is that the identity of the clients is kept completely anonymous.
The South Korean government has attempted to ban beehive accounts, but a court ruling stated that this would not be possible. If such a ruling was accepted, it would mean that the South Korean government can close exchange corporate bank accounts at their whim.
Perhaps these issues will be investigated more closely and a more permanent solution will be found. South Korea is already developing its own blockchain ID system that would be released by 2020.
Blockchain tech is highly valued in South Korea and as it becomes more and more popular, exchanges will without a doubt receive better regulation that will probably forbid many of the practices which give blockchain tech and crypto a bad reputation.
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