South Korea targets illegal crypto transfers via WeChat and Alipay
South Korea’s Customs Service has uncovered one of the largest illegal money transfer schemes involving cryptocurrencies and Chinese nationals. Fiat funds were transferred via WeChat and Alipay before being converted into cryptocurrency.
According to Yonhap, cited by Cointelegraph, South Korea’s Customs Service has charged three suspects in connection with a cryptocurrency-related money transfer scheme worth approximately 150 billion won (over $100 million), conducted using WeChat Pay and Alipay.
The group disguised the transfers as legitimate expenses, including cosmetic surgery costs and tuition fees for foreign students. Funds originating from China were converted into cryptocurrency through overseas exchanges, transferred to Korean wallets, and then withdrawn again as fiat currency.
Authorities struggle to track off-bank flows
The large volume of transfers and their cross-border nature highlight the challenges authorities face in tracking international financial crimes involving digital assets.
In December 2025, following a similar investigation, a woman in her early thirties was sentenced to prison for laundering approximately $180 million through cryptocurrencies, marking one of the largest such cases uncovered by regulators.
“The fact that she entered this world through a group chat shows how sophisticated criminals have become, using encrypted channels to operate outside the visibility of traditional banking systems,” financial platform OneSafe wrote at the time.
As a result, South Korea’s Financial Services Commission is preparing to expand anti-money laundering regulations by applying the “Travel Rule” to transactions of 1 million won ($680), requiring exchanges to collect data on these transfers.
The measure aims to prevent potential money laundering schemes in which transactions are deliberately split into smaller amounts to avoid detection.
As we wrote, South Korea opens the door to institutional crypto investing
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