Shown above the an office of Upbit, a crypto exchange operated by Korea’s Dunamu. The outfit tries to deal with problematic practices and transactions in the crypto market. Photo courtesy of Dunamu

Korean outfit comes up with advanced anti-fraud system

South Korea’s leading crypto-exchange Upbit announced on Sept. 26 that the outfit had discovered fraudulent exchanges amounting to more than $20 million thus far.

The Seoul-based company has developed its own fraud detection system, which was aimed at finding out any problematic transactions over the blockchain assets.

“Because the crypto assets are traded around the clock, it is very significant to keep a tab on them without any exceptions,” an Upbit official said.

“We came up with an artificial intelligence-based system to discover any wrongdoings in the crypto exchanges. We think that the program is trustworthy as it keeps improving based on machine learning.”

Observers point out that such efforts are essential to deal with the rising threats from sophisticated scams.

For example, there is a SIM swap scam, an account takeover fraud attacking a weakness in two-factor authentication and two-step verification through a mobile phone text message.

Upbit, which is operated by Dunamu, said that is equipped with a smart system to find out such fraudulent attempts and grapple with them.

Toward that end, the Seoul-based outfit has operated an always-on monitoring system since Sept. 2021.

“We have discovered a set of voice-phishing attempts over the past few years. During the span, up to 9.2 billion won ($6.8 million) were refunded to the victims,” an Upbit representative said.

On top of the anti-fraud system, Upbit took pride in its anti-money laundering system.

“When it comes to the fights against financial swindles, we think that we are second to none in this country,” the Upbit official said. “We will continue to put forth efforts to tackle the challenges in the crypto asset market.”

The publisher studied Korean history in Seoul and management of business administration in the United Kingdom. He has 20-year experiences in the media business. Kim can be reached at voc200@gmail.com or 82-2-6956-6698.