South Korean prosecutors are continuing to wage war against illegal kimchi premium traders – and will seek to convict 20 people for allegedly conducting $3.2 billion worth of illegal crypto transactions.The kimchi premium is a phenomenon whereby increased trading volumes on South Korean crypto exchanges drive prices above the global average.Some South Korean traders have attempted to exploit this by buying tokens like bitcoin (BTC) from overseas over-the-counter vendors via wire transfers. They then dump the coins on domestic crypto exchanges for a hefty profit.During recent bull runs years, domestic retail investors’ trading volumes have tended to rocket upwards extremely rapidly. In some cases, this has led to sudden discrepancies of up to 50% between domestic prices and overseas averages. But prosecutors have grown wise to this tactic – and last year began clamping down on what they believe are vast networks of such traders. Officers think that these networks stretch across national borders and make use of shell companies, created in a bid to throw investigators off the investigative trail.In its latest offensive on suspected kimchi premium traders, the Seoul Central District Prosecutors Office and the Korea Customs Service indicted 20 people, 11 of whom were retained in police custody, Munhwa Ilbo reported.Officers claim the group made use of 256 domestic bank accounts and had pretended that the money that went through these accounts – destined for Hong Kong – was being used to pay for overseas trade items.Kimchi Premium Gang ‘Bribed Brokers,’ Say ProsecutorsThe prosecutors also claimed that the group bribed brokers over $16,000 to help it open bank accounts. The group was allegedly operational from 2021 until the summer of last year. Officers stated they were hopeful of recouping at least $10.6 million of the $3.2 billion total.Last year, prosecutors stated that they were investing in sophisticated crypto tracking tools with a view to shutting down kimchi premium trading.Officers have previously stated that they believe at least $6.5 billion has been laundered through South Korean banks by kimchi premium traders in recent years.
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