South Korea is stepping up its fight against cryptocurrency market manipulation, underscoring the need for investor awareness.
Crypto Manipulation in South Korea
South Korea's financial regulators, including the Financial Services Commission (FSC) and Financial Supervisory Service (FSS), have reported several individuals to prosecutors for alleged price manipulation in the cryptocurrency market. These individuals are accused of employing strategies aimed at artificially inflating and deflating cryptocurrency prices, deceiving investors. The tactics mainly involve the 'racehorse tactic' and 'confined pumping'.
The ‘Racehorse Tactic’
The 'racehorse tactic' involves creating sudden artificial price spikes right at midnight. This timing is chosen because exchanges reset their daily price change calculations at this hour. The aim is to create a false impression of rapid price growth, enticing further purchases by other traders.
Regulators’ Role in Combating Manipulation
The proactive response of South Korean regulators underscores their commitment to maintaining market integrity and protecting investors. The referral of suspects to legal authorities highlights the seriousness of the allegations against them, representing an essential step towards a more stable and secure crypto market.
The actions taken by South Korean regulators serve as a reminder of the importance of vigilance in the cryptocurrency landscape. Understanding manipulative tactics can help investors navigate the dynamic market more safely.
