Prosecutors raid South Korea's biggest cryptocurrency exchange: Yonhap

Irene MckinneyMay 13, 2018

Authorities searched the exchange's offices on Thursday and Friday, according to an official from the Seoul Southern District Prosecutors' Office, who asked not to be identified citing office policy. The awful sentiment seems to be a reaction to reports that South Korea's exchange Upbit is suspected of fraud. Upbit is the largest exchange in Korea, so this raid will inevitably send shockwaves through the crypto industry in East Asia.

The cryptocurrency market has fallen by large margins after UPbit, South Korea's biggest cryptocurrency exchange and formerly the world's second-largest trading platform, was raided and investigated by local police on May 11, 2018.

The company [Upbit] is suspected of transferring customer funds from their cryptocurrency exchange account to a representative or executive account...

"UpBit is now under investigation by prosecution, and we are [cooperating] diligently", the company said on its website, according to Google translate.

The South Korean operator dealt approximately $1.6 billion of digital currency trades in the last 24 hours, which makes it the largest cryptocurrency in the country and the fourth in the world by daily trading volumes.

Upbit was raided for suspected fraud in a joint action between the Korean Financial Intelligence Unit, Financial Services Commission and Seoul Police. The company added that services such as transactions and withdrawals were unaffected and client assets were safe.

"After the digital forensics investigation on the seizures [seized items] and confirming the illegal charges, we will decide whether and in what direction we will investigate further", the prosecutors were quoted saying.

"We found some circumstantial evidence that shows Upbit sold a larger amount of crypto coins than it actually owned in the early business phase", an official from the prosecutors."
The FSC will be investigating UpBit's computers to audit whether or not the exchange was lying to the authorities.

Image courtesy of Coinmarketcap and Shutterstock.

Following news of an exchange raid in South Korea, Bitcoin's price is holding steady.

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