South Korean Prosecutors Buy Blockchain Analytics Tools in Bid to Bust ‘Crypto Money Laundering’
South Korea’s prosecution service will buy new blockchain analytics software – and wants to use it to catch people laundering crypto overseas.
Per the domestic media outlet Economist, the new tools will be used to apply the same level of scrutiny to overseas exchanges as is currently applied to domestic exchanges.
The project is the brainchild of the Supreme Prosecutor’s Office.
The office has opened a bidding process for the project.
It has named the project the “Advanced Cyber Investigation System” (literal translation).
The bidding process will be wrapped up this month, and the winning contractor will be given until November this year to deliver the new tools.
How Do South Korean Prosecutors Hope to Catch ‘Crypto Money Launderers?’
Police and the judiciary have been given sweeping powers to examine crypto transaction data at domestic exchanges.
Trading data has been completely de-anonymized by a law that requires all citizens using crypto exchanges to link their wallets with real name-verified bank accounts.
Police and the judiciary have also been given the power to force exchanges to freeze wallets.
They are also allowed to search exchanges as part of their investigations.
But many criminals, the police think, are attempting to evade investigators by using overseas crypto exchange platforms.
The Supreme Prosecutor’s Office hopes its new tools will help change this.
Law enforcers and judiciary staff have been using a monitoring tool that was first deployed in prosecutors’ offices nationwide in April 2021.
But it says this tool cannot currently “identify virtual currency addresses generated by foreign exchanges.”
The office claimed that the new software will be able to plug this gap.
It also claimed the tool would let it “track and delete illegally filmed videos” and “crack down on pornographic sites.”
And the office claimed that it would be able to track illegal sites “even if they periodically change site addresses to evade blocking efforts.”
Law enforcement and judiciary spending on blockchain analytics tools is on the rise in South Korea.
Late last year, police and prosecutors announced they would quadruple their spending on tools that help them monitor crypto transactions.
In addition to anti-money laundering drives, police and prosecution officials are currently fighting what the President has called a “war” on crypto-powered drug trafficking.