South Korean Crypto Exchanges Blocked $82m Worth of Romance Scam Transactions in 2023

South Korean Crypto Exchanges Block $82M in Romance Fraud Transactions in 2023

South Korean Crypto Exchanges Block $82M in Romance Fraud Transactions in 2023


South Korean crypto exchanges say they blocked more than $82 million worth of transactions linked to romance scams last year.

On the Seoul Shinmun, crypto exchange Coinone claimed that catfishing and other romance scams that use cryptocurrencies are now “rampant” in South Korea.

Coinone said it stopped more than $2.6 million worth of romance scam transactions. The firm said it uses an “abnormal transaction detection system” and a “24-hour monitoring” network to protect customers.

The announcement comes days after a warning from the Financial Supervisory Service (FSS).

On January 22, the FSS claimed that there had been an increase in cryptocurrency-related scams on social media sites.

The regulator told the public to beware of Romanian fraudsters. The FSS also warned against the dangers of unsolicited “investment-related recommendations and advice”.

And the regulator said the public should be “particularly” concerned about “people of the opposite sex or strangers who say they will help with investments”.

‘Romance’ Bait for Crypto Scam Masterminds

“Romance scammers,” the FSS wrote, are often “linked” to “illegal” or fake crypto exchanges.

Coinone cited the example of a man in his 60s who was “fooled by a romance scam group” and “almost gave up all his crypto assets.”

The exchange said the man tried to send his coins to a private wallet. The man thought the wallet belonged to a hair salon owner in Japan.

Exchange staff said they discovered the fact that the man had recently installed a “Japanese chat app” and a Japanese-Korean translation app on his mobile phone.

The company also discovered that the name on the wallet was different from what the man had provided in his transaction request.

Coinone called the man to ask for more details about the transaction. Staff heard that the man’s new “friend” had asked him to send bitcoins to a “crypto exchange” before coming to “visit” him in South Korea.

The “exchange” turned out to be fake, and Coinone told the man that he was probably the target of a romantic scam.

Graph showing transaction volumes on the Coinone crypto exchange over the past 12 months.
Coinone crypto exchange transaction volumes for the last 12 months. (Source: CoinGecko)

Other South Korean exchanges also said they had also started monitoring transactions around the clock to block suspicious withdrawal requests.

They also create databases of suspected fraudulent crypto exchanges. And they recently started working with regulators to find and report fake trading platforms.

A South Korean man uses a domestic cryptocurrency app on his mobile phone
A South Korean man uses a domestic cryptocurrency app on his mobile phone. (Source: KBS/YouTube)

The rise of South Korea’s crypto-fueled romance scams

In its warning, the FSS added that fraudsters often pose as tax officials and securities providers who “demand payment” in cryptocurrencies.

Criminals reportedly issue warnings to potential victims. Bank accounts and cryptocurrency wallets are said to be frozen if victims do not send coins or money.

Organized groups of East Asian crypto fraudsters are turning to dating apps to find targets.

In 2022, Japanese police also warned of a sharp increase in fraudulent incidents involving “international dating sites”.

South Korean police have urged the public to avoid people on dating sites who try to convince them to invest in online cryptocurrency mining projects.

Also in 2022, a South Korean woman was jailed for five years after being found guilty of drugging a man she met online.

A woman robbed a man of $87,000 worth of tokens after learning he was a crypto investor.

Leave a Comment

Your email address will not be published. Required fields are marked *