South Korea’s FSS Sets Agenda: Harsher Penalties for IT Failures, Crypto Manipulation Probes

South Korea’s Financial Supervisory Service will increase its oversight of the cryptocurrency market and apply more stringent penalties to financial firms for IT-related incidents, the watchdog stated, following serious lapses that exposed threats to market order and consumer protection.

The FSS unveiled its yearly policy plan on Monday, outlining scheduled investigations into high-risk crypto market practices and the introduction of punitive fines for IT failures across the financial sector, Yonhap news agency reported.

In its focus on crypto market supervision, the FSS said it will undertake targeted probes into activities that disrupt market fairness. This includes investigating price manipulation by large traders, known as “whales,” along with strategies like artificially pumping the prices of tokens whose deposit and withdrawal services have been stopped on specific exchanges.

The report adds that other schemes under scrutiny involve rapid price-pumping operations, market manipulation using application programming interface orders, and the spreading of false information on social media.