South Korean Prosecutors Fail to Shut Down Kimchi Premium Crypto Traders
South Korean prosecutors have suffered a blow in their efforts to shut down kimchi premium crypto traders – with 14 suspects cleared of wrongdoing. Officials accused 16 people of illegally remitting $3.2 billion worth of assets, including crypto, fiat, and goods. Two of the group were found guilty of minor offenses, with one receiving a 12-month jail sentence and the other a six-month prison term.
South Korean Prosecutors Seek Second Trial
The Seoul Central District Court acquitted 14 individuals, including an individual suspected of masterminding the operation. Prosecutors are trying to hunt down crypto traders they suspect of exploiting crypto exchange prices to the tune of around $6.5 billion. However, the District Court rejected the prosecution’s case, stating that it was largely based on Supreme Court precedent rulings rather than acts of law. The prosecution has already submitted an appeal request and believes they will secure a more favorable verdict in the High Court.
What Is the Kimchi Premium?
The kimchi premium is a phenomenon where Bitcoin (BTC) and altcoins trade at higher prices on South Korean exchanges compared to international platforms. This occurs when demand rises in the South Korean retail investment market. Traders exploit this by buying coins from foreign vendors and selling them on domestic platforms. While this type of trading may be unethical, there is debate within the South Korean legal community about whether it violates national law.
Court Ruling and New Crypto Laws
The court ruled that it was difficult to prove without doubt that the accused had done anything wrong and that Supreme Court precedents did not address the core issues surrounding kimchi premium trading. New crypto-related laws with stricter punishments for market manipulation offenses are set to come into force on July 19, 2024.
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