South Korean regulators plan to freeze accounts suspected of manipulating crypto accounts during the investigation phase.
TL;DR
South Korean regulators are considering a 'preventative freeze' to temporarily block accounts suspected of crypto price manipulation during investigations, aiming to align enforcement with stock market standards and shift to in-process intervention.
On January 7, South Korean financial regulators are evaluating the introduction of a "preventative freeze" mechanism, allowing for the temporary freezing of accounts involved in suspected price manipulation before any proceeds from cryptocurrency transactions have been cashed out. The Financial Services Commission (FSC) is studying a trading suspension system, aiming to align cryptocurrency enforcement standards with those of the stock market to address current issues of needing court orders and delays in processing.
This discussion comes as South Korea pushes forward with the second phase of its crypto legislation, which may focus on stablecoins and market manipulation. If implemented, regulation will shift from post-event accountability to in-process intervention, increasing scrutiny of high-frequency, automated trading and short-term abnormal fluctuations, and significantly tightening the market enforcement environment.