South Korea upgrades AI crypto surveillance, enabling automated detection of crypto price manipulation under stricter digital asset enforcement rules.
South Korea is strengthening crypto market oversight as trading activity becomes increasingly complex. On Monday, the Financial Supervisory Service confirmed the expanded use of artificial intelligence for crypto prices monitoring.
FSS Deploys Automated AI Surveillance for Crypto Markets
The Financial Supervisory Service announced enhancements of its Virtual Assets Intelligence System for Trading Analysis, referred to as VISTA. The system is deployed to investigate unfair cryptocurrency trading practices in the country. Regulators confirmed that automated detection is now taking the place of largely manual investigation processes.
Various new automated detection algorithm has been added to VISTA, according to the FSS. This algorithm can detect possible price manipulation periods without human intervention. Therefore, regulators can monitor the markets around the clock rather than responding after suspicious activity takes place.
The key improvement involves the use of a sliding window grid search technique. This way the AI can analyze all possibilities of sub periods in big trading data. As a result, the system will be able to isolate precise manipulation windows more accurately.
According to officials, the method enhances the accuracy of detection through volatile trading environments. In addition, it minimizes delays in the investigation due to manual review of data. Consequently, enforcement responses can be set in motion much faster.
The upgrade is also reflecting increased regulatory investment for 2026. The FSS estimated 170 million KRW or about $116,000 to further improve performance. This funding will improve system capacity and speed of analysis.
Alongside VISTA, regulators introduced another cyber abnormal transaction detection artificial intelligence system. This tool analyzes posts from the internet, YouTube and social media discussions. Its aim is the detection of pump and dump schemes before they are carried out.
Authorities said predictive surveillance is now necessary because of online market influence coordination. Therefore, keeping a check on digital narratives became a fundamental enforcement priority. This approach facilitates earlier intervention and risk containment.
Expanded AI Roadmap Strengthens Crypto Enforcement Framework
The FSS detailed other AI capabilities that were to be rolled out during 2026. These upgrades will extend surveillance beyond isolated trading activity. Instead, regulators are interested in analyzing coordinated behavior on entire networks.
One planned feature is on automated network identification. This tool will chart relationships between colluding trading accounts. Consequently, the authorities can detect groups of organized manipulation more efficiently.
Another improvement will add advanced text analysis tools. In these systems, abnormal trading related language for thousands of digital assets will be processed. As such, it is possible to automatically flag unusual promotional or manipulative messaging.
Fund tracing technology is also due to be expanded. Regulators plan to get better track on funds used in manipulation schemes. This will help pick the sources of origins and laundering attempts better.
These technological upgrades are supporting under the Virtual Asset User Protection Act enforcement. The legislation has been in force since July 2024. It imposed stringent punishments for serious offences under the crypto trading scheme.
Under the act, illegal profits estimated to be over 5 billion won are subject to severe punishment. Offenders can receive up to life imprisonment and a fine between 4 and 6 times illicit gains. Therefore, regulatory consequences are still important.
Regulators are also pushing for preemptive account freezes. This measure is to prevent suspects from laundering money during the investigations. Officials said early asset control helps to strengthen enforcement credibility.
South Korea Shifts to AI-Led Crypto Enforcement Model
The FSS emphasized that automation creates a better fairness and consistency. Human bias and investigative gaps are minimized due to AI oversight. As a result, enforcement becomes more transparent and predictable.
Market participants are likely to be scrutinized more in the future. Constant monitoring reduces opportunities for manipulation. As a result, compliance trading behaviour might be increased.
South Korea’s method is part of a larger AI-led regulatory trend in the world. Authorities are trying to balance innovation and investor protection. Therefore, advanced surveillance is becoming central to digital asset governance.
Overall, the AI upgrades are a structural change in crypto enforcement. Regulators are focusing on prevention not reaction. This transition makes South Korea a leader in the automated crypto market oversight.