Key Highlights
- A South Korean gangster gets 8 years for stealing $332K in Bitcoin and joining a large crypto fraud ring.
- The fraud ring defrauded nearly 150 victims of 9.7 billion won via crypto and gold price schemes in just over a year.
- Authorities step up crypto security, moving seized assets to private custody under strict oversight.
A South Korean gangster will spend eight years in prison after stealing $332,000 in Bitcoin from an acquaintance and joining a bigger fraud ring while on the run. The Busan District Court handed down the sentence, pointing to the serious damage caused by his actions.
The man, identified as Mr. Kim, in his 30s, worked as an enforcer for the Busan-based organized crime group “Chilseongpa” (known in English as the Seven Star Mob), thought to be the largest of its kind in South Korea.
On July 15, 2019, Mr. Kim received about 500 million won in Bitcoin from a person called “A” through an intermediary. Instead of returning the money, he spent it gambling online. The original agreement promised a 0.5% commission on the sale proceeds. Mr. Kim’s actions caused financial losses for the first victim and highlighted the risks of poorly regulated cryptocurrency dealings.
Fraud ring involvement and money laundering
After fleeing during his trial, Mr. Kim joined an investment fraud group in February 2021 via Telegram. He managed money laundering, coordinated three launderers, collected commissions, and pushed victims into illegal gambling sites.
The network used gold and cryptocurrency price changes to trick investors, defrauding 149 people of about 9.7 billion won across 741 transactions in just over a year. Presiding Judge Kim Hyun-soon said, “This is an organized crime, and the number of victims and the scale of the damage are substantial. We took into consideration the fact that the victims have petitioned the court for severe punishment, and that the defendant acknowledged most of the charges and showed remorse.”
Crypto crimes in South Korea continue beyond this case. Earlier this year, a man in Seoul poisoned his business partner over a cryptocurrency dispute. Authorities arrested Mr. A (39) on attempted murder and violation of the Pesticide Management Act.
Regulatory response and industry measures
South Korea’s National Tax Service plans to transfer seized cryptocurrencies to private custody firms for better security. This follows incidents where nearly 6 billion won was stolen after security codes were leaked. The NTS will check each provider’s security, size, and insurance under the Virtual Asset User Protection Act.
Meanwhile, the People Power Party has proposed eliminating cryptocurrency taxes starting in 2027. Party leader Song Eon-seok said taxing crypto alongside commodities could lead to double taxation, administrative challenges, and reduced market access.
South Korea now faces a careful balance between fighting crypto crime and creating a secure, investor-friendly digital asset environment.
Also Read: How Pakistan Used Crypto Diplomacy to Build Ties With Trump’s Inner Circle
