A South Korean financial regulator is set to go on the warpath in search of high-end kimchi traders – and vows to bring suspected offenders to justice.
As Previously reportedthe kimchi bounty is a phenomenon in the crypto trading markets where Bitcoin (BTC) and altcoins trade on national exchanges at significantly higher prices than on international trading platforms. This is usually due to spikes in demand among retail investors in South Korea.
Some opportunistic traders have sought to take advantage of the kimchi premium by buying BTC over-the-counter (OTC) traders overseas, then “dump” the coins for a profit on South Korean platforms like Up bit.
To do this, traders need to buy coins overseas and have mainly sought OTC sellers in China and Japan. Banks has been said to eradicate this process by introducing caps on remittances abroad.
But some traders seem to have slipped through the net. The Segye Ilbo reported that the regulations Financial monitoring service (FSS) is investigating two transactions allegedly made by high-end kimchi traders.
The first was worth $987 million and was made through the national bank shinhan. The second was worth some 608,000 USD and was carried out to Woori Bank.
Both banks flagged the transactions as suspicious and reported them to the FSS. No exact indication was given as to when these transactions took place, although it is believed that they may have taken place at the peak of the kimchi premium when BTC was around 30% more expensive in South Korea. South than the world average – about two or three years. from.
The FSS believes the traders may have sought to conceal their actions by sending their profits overseas. In an attempt to confuse regulators, they appear to have sent fiat to accounts held in both China and Japan.
The traders also appear to have attempted to conceal their actions by using a number of companies as intermediaries. They reportedly told banks that they were “paying for imported goods such as gold bars”.
The FSS conducted several “on-site investigations” as part of its investigation and has since referred both cases to the prosecution.
Prosecutors are also investigating cases referred to them earlier this year by the Financial Intelligence Unit, the regulator that directly controls crypto exchanges. The cases were first investigated by investigators based in Daegu, a city in the south of the country.
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