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South Korea's fight against cryptocurrency crime exposes serious loopholes in AML.

The South Korean cryptocurrency sector is under intense scrutiny after the amount of money transferred to Cambodia increased more than 1,400 times in the past year, raising concerns about money laundering. The two largest exchanges, Bithumb and Upbit, were found to have processed over 12.7 billion won in suspicious transactions, mainly in USDT, sent to Huione Guarantee – a platform that has been sanctioned by America and the UK.

Lawyers believe that early detection of illegal transactions is nearly impossible, while criminals are shifting their activities to Cambodia and the Philippines to evade tightening regulations at home. South Korea is currently the second largest cryptocurrency market in the world, with total assets over 73 billion USD, but legal loopholes and strict AML regulations are hindering competition.

Notably, Binance has just returned to South Korea by acquiring 67% of GOPAX, which is expected to break the dominance of Upbit and Bithumb.

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