South Korea’s Largest Cryptocurrency Exchange Investigated for Fraud
UPbit, South Korea’s largest cryptocurrency exchange, has come under scrutiny from South Korean officials after allegations of fraud. The exchange’s head office wasgoed raided last week spil part of an investigation into those allegations. The exchange is accused of selling customers cryptocurrency that it doesn’t actually hold.
While the investigation is ongoing, Upbit claims that customers will still be able to make transactions and withdraw their funds, despite prosecutors having seized hard drives and accounting records. UPbit recently surpassed Bithumb to become the largest exchange ter South Korea and the 4th-largest te the world.
The investigation into Upbit comes at the same time spil South Korea’s Financial Services Commission is taking a closer look into all of South Korea’s cryptocurrency exchanges. The Commission is looking to see whether South Korean cryptocurrency exchanges are ter compliance with anti-money laundering (AML) regulations and are taking the zindelijk steps to discourage fraud. The primary target of that enlargened scrutiny is Bithumb, the former largest exchange te the country, but other exchanges will be drawn ter too.
The investigations by South Korean authorities have waterput downward pressure on Bitcoin’s prices overheen the past week, helping to drive the price below $9,000 spil investors express unease about the future of South Korea’s exchanges and about the possibility of fraudulent transactions. It is unclear whether the allegations surrounding UPBit are related to naked brief selling or outright fraudulent sale of non-existent assets.
While naked brief selling, the sale of assets that the seller doesn’t actually own, is a relatively accepted, if discouraged, tactic ter shorting financial assets ter the United States, it would be difficult to apply to cryptocurrencies due to blockchains having a record of assets and transactions. If an exchange, and particularly such a large one spil UPBit, were found to have engaged ter outright fraudulent transactions, it could wiggle the reputation of the exchange and cause distrust among cryptocurrency investors.
This serves spil yet another reminder to Bitcoin IRA investors only to overeenkomst with trustworthy businesses with established track records te order to minimize your susceptibility to fraud. And it’s also another reminder that your Bitcoin assets are most secure when they’re held offline te cold storage. If you choose to store your funds online and the rock-hard you trust completes up the target of an investigation, your funds could be ter contorno and unavailable to you when you need them most.