South Korea's harsh cryptocurrency judgment sets disturbing precedent for innovation

South Korean courts have sentenced 12 to 20 years in prison for a case involving a $1.6 billion cryptocurrency Ponzi scheme, one of the country's most severe penalties for financial fraud. The defendant operated a false trading platform that embezzled tens of thousands of victims, used new investments to pay previous participants, and laundered money through offshore shell companies. The ruling sets an important legal precedent as South Korea strengthens its cryptocurrency regulation, and the Financial Supervisory Commission (FSC) is proposing stricter audit and transparency requirements for digital asset companies.