$3.2M in Crypto Seized in South Korea Fraud Bust
Posted: Thu Jun 26, 2025 12:03 pm
South Korean police have dismantled a major crypto fraud ring that used a fake exchange network to launder nearly $694.5 million through illegal transactions over six years. Authorities seized $3.2 million worth of hidden Ethereum as part of the investigation, exposing a growing threat to South Korea’s booming crypto market.
According to the Busan Western District Prosecutors’ Office, the scam involved unregistered money exchangers using Neteller Pay, an overseas payment platform similar to Cash App, to bypass Korea’s strict financial laws. These operators collected funds from everyday citizens and processed them illegally between 2019 and 2024, raking in about $18.9 million in commissions.
So far, five suspects have been indicted, with more investigations ongoing. The scheme relied heavily on fraudulent foreign exchange operations and the use of anonymous wallets to conceal assets. Police eventually tracked down hidden Ethereum wallets containing 4.4 billion won worth of crypto.
This case is the latest in a troubling trend. Just last month, Korean police arrested 28 people in another scam involving fake crypto investment tokens. Earlier this year, notorious figure “Coin King” Jonbur Kim was also arrested for manipulating the Artube coin and defrauding investors of nearly $47 million.
With South Korea's crypto market reaching $130 billion in value, it's becoming a prime target for sophisticated fraud rings. Even as adoption rises, cases like this highlight the urgent need for tighter oversight, particularly with platforms that operate outside local regulations.
Is this just the tip of the iceberg? Can regulators keep up with the pace of crypto innovation — or are these kinds of operations becoming too complex to trace?
Let’s hear your thoughts on what’s next for South Korea’s crypto scene.
According to the Busan Western District Prosecutors’ Office, the scam involved unregistered money exchangers using Neteller Pay, an overseas payment platform similar to Cash App, to bypass Korea’s strict financial laws. These operators collected funds from everyday citizens and processed them illegally between 2019 and 2024, raking in about $18.9 million in commissions.
So far, five suspects have been indicted, with more investigations ongoing. The scheme relied heavily on fraudulent foreign exchange operations and the use of anonymous wallets to conceal assets. Police eventually tracked down hidden Ethereum wallets containing 4.4 billion won worth of crypto.
This case is the latest in a troubling trend. Just last month, Korean police arrested 28 people in another scam involving fake crypto investment tokens. Earlier this year, notorious figure “Coin King” Jonbur Kim was also arrested for manipulating the Artube coin and defrauding investors of nearly $47 million.
With South Korea's crypto market reaching $130 billion in value, it's becoming a prime target for sophisticated fraud rings. Even as adoption rises, cases like this highlight the urgent need for tighter oversight, particularly with platforms that operate outside local regulations.
Is this just the tip of the iceberg? Can regulators keep up with the pace of crypto innovation — or are these kinds of operations becoming too complex to trace?
Let’s hear your thoughts on what’s next for South Korea’s crypto scene.