Korea Weighs Crypto Account Freezes and Whistleblower Bounties

South Korea's financial authorities are considering implementing stricter regulations on cryptocurrency trading to prevent market abuse. The proposed measures include the ability to freeze digital asset accounts and linked bank accounts, as well as a formal rewards program for whistleblowers who report unfair trading practices.

The move is part of a broader effort to strengthen regulatory oversight in the country's rapidly growing crypto market. According to officials from the Financial Services Commission (FSC) and other relevant agencies, they are actively reviewing measures modeled on existing capital market frameworks.

The proposed measures would give authorities more direct levers to combat pump-and-dump schemes, insider trading, and other forms of market manipulation that have historically plagued the sector. However, the prospect of account freezes also raises questions about due process and the potential for overreach, particularly in cases where funds are frozen preemptively during investigations.