South Korea to strengthen control over crypto mixers

The South Korean authorities plan to strengthen control over cryptocurrency mixers following the United States.

On Jan. 15, local media in South Korea reported that the Financial Intelligence Unit (FIU) of the Financial Services Commission was considering introducing virtual asset mix rules. The agency emphasized that criminals are still laundering money since Korea does not yet have separate sanctions against mixers.

“Responding proactively to virtual asset crimes is positive from a market resilience perspective.”

Hwang Seok-jin, professor at Dongguk University

Before this, U.S. authorities also agreed on the need to regulate mixers and took action. Last October, the U.S. Treasury Department’s Financial Crimes Enforcement Unit (FinCEN) announced anti-money laundering (AML) regulations governing Mixer as a money laundering service.

Later in December, the U.S. Department of the Treasury (OFAC) added the Sinbad platform to its sanctions list. OFAC accuses Sinbad of conducting money laundering operations obtained by the hacker group Lazarus. Sinbad processed millions of dollars in virtual currencies accepted as a result of hacker attacks on famous projects such as Horizon Bridge, Ronin Bridge from Axie Infinity, and Atomic Wallet.

The U.S. government has also indicted and detained the founders of Tornado Cash on charges of laundering more than $1 billion and violating sanctions. These actions highlight the authorities’ determination to combat the use of cryptocurrency mixers for illicit purposes and continue to send signals of strict cryptocurrency control measures.