worldcoinindex.com
South Korea’s financial regulator is sharpening its grip on the cryptocurrency sector, pledging tougher supervision and heavier penalties after a series of incidents raised concerns over market integrity and consumer protection.
The Financial Supervisory Service (FSS) outlined the tougher stance in its annual policy roadmap released Monday, signaling expanded investigations into high-risk behavior in crypto trading and the introduction of punitive fines for IT system failures across the wider financial industry.
Under the new oversight push, the watchdog plans targeted probes into practices that disrupt fair market order. These include alleged price manipulation by large holders, commonly referred to as “whales,” as well as schemes that inflate token prices when deposits or withdrawals are temporarily frozen on exchanges. Authorities are also focusing on rapid pump-and-dump activity, manipulation via automated API orders, and the spread of misleading information through social media channels.
The renewed scrutiny follows a recent operational error at Bithumb, the country’s second-largest crypto exchange, where a system mistake during a promotional event led to hundreds of users being credited with an enormous amount of bitcoin. The exchange later said it had recovered nearly all of the assets, but the incident highlighted ongoing vulnerabilities in exchange infrastructure and controls.
Beyond enforcement, the FSS confirmed it has set up a dedicated task force to prepare for the rollout of the Digital Asset Basic Act, a major piece of second-stage crypto legislation. The group is developing disclosure standards for token issuance and exchange listings, along with licensing review guidelines for digital asset service providers and stablecoin issuers. The finalized law is expected to be introduced in the first quarter of this year.