South Korea's central bank joins hands with local police to crack down on digital currency scams

South Korean law enforcement is set to launch a special investigation into price gouging in altcoins and digital currency scams, according to Chosun Ilbo, one of the country’s most widely circulated newspapers.

The Bank of Korea (BOK) will also support the investigation operations of local law enforcement agencies and provide them with the necessary infrastructure and technology for investigations.

One of the focuses of this joint investigation is the trading of altcoins that have no value in themselves or are suspected of being involved in pump and dump scams.

The report said:

“According to our sources, there are 676 cryptocurrencies listed on coinmarketcap, but only 309 of them actually have a market cap of $10,000, while the rest have almost no value. In addition, 550 of them have extremely low daily trading volumes.”

The Bank of Korea and local police have already investigated several altcoins and are discussing with local law enforcement agencies whether to launch a full investigation into these altcoins and whether to investigate individuals or organizations that promote these altcoins, which have had quite low trading volumes in the past 48 hours.

So, for some investors who want to invest in digital currencies, how can they avoid becoming victims of these digital currency scams? Here are two suggestions:

1. First of all, we need to see whether the coin is stable, which is also the most important consideration. Nowadays, it is becoming easier and easier to create altcoins, and some of them cannot last long due to the small market or the weaknesses of the development process itself. However, well-known digital currencies such as Bitcoin are developed by a dedicated development team through SHA-256 and Scrypt algorithms and have good technical support.

2. Secondly, it depends on whether the developers of a digital currency provide various development information to their community. More transparent community interaction can build stronger network trust. It is also necessary to clarify who pays for any changes in the digital currency, which can also increase the reliability of investment.