TLDR
- Six Chinese nationals arrested in Jeju, South Korea for allegedly stealing $689,000 during a Tether transaction at a hotel
- The suspects allegedly attacked a crypto dealer and stole cash after claiming the dealer made Tether “disappear” during the exchange
- Police recovered 369 million won but are still searching for the remaining funds
- The suspects claim they were originally planning to exchange Korean won for Chinese currency
- South Korea’s Financial Services Commission is simultaneously developing new crypto regulations for enhanced user protection
A cryptocurrency transaction turned violent on Jeju Island, South Korea’s popular tourist destination, resulting in the arrest of six Chinese nationals accused of stealing nearly $690,000 during a failed Tether exchange on January 16, 2025.
According to reports from the Jeju Western Police, cited by Maeil Business Newspaper, the incident occurred at a local hotel where the suspects allegedly attacked a cryptocurrency dealer, identified only as “A,” and took cash intended for a stablecoin exchange.
The police investigation revealed that the group, including a man in his 40s identified as “B,” claimed they were actually victims in the situation. They accused the dealer of making Tether stablecoins “disappear” during the transaction, which led to the confrontation.
Law enforcement moved swiftly to apprehend the suspects. Two were arrested at the hotel where the incident took place, while three others were caught attempting to leave through Jeju International Airport. The sixth suspect was located and arrested at another currency exchange facility.
During the arrests, police recovered 369 million won in cash from the suspects. However, a substantial portion of the stolen funds, approximately 631 million won, remains unaccounted for, and authorities are actively tracking these missing funds.
The suspects have unanimously denied the charges against them. They maintain that their original intention was to exchange Korean won for Chinese currency, claiming they were persuaded to use virtual currency instead of conducting a traditional currency exchange.
However, investigators have developed a different theory about the incident. They believe the group had planned to use Tether from the beginning and deliberately moved the stablecoins out of the wallet during the exchange before attacking the dealer to steal the funds.
The incident has highlighted the risks associated with in-person cryptocurrency transactions, particularly those involving large sums of money. The case is unusual because it combines elements of both digital and physical theft, with the alleged perpetrators using violence to obtain physical cash rather than focusing solely on digital assets.
The timing of this incident coincides with broader developments in South Korea’s cryptocurrency regulatory landscape. The country’s Financial Services Commission (FSC) has recently begun implementing the second phase of its cryptocurrency regulations.
FSC Vice Chairman Kim So-young has acknowledged that the global crypto market is experiencing rapid changes, creating an environment of both optimism and uncertainty. This assessment has prompted the regulatory body to accelerate its efforts to establish more comprehensive oversight.
The new regulatory framework being developed will address several key areas in the cryptocurrency ecosystem. These include specific rules for stablecoins like Tether, which was involved in the Jeju incident, as well as regulations governing cryptocurrency exchanges and business entry requirements.
The police investigation into the Jeju incident remains active, with authorities working to recover the remaining stolen funds and gather additional evidence to support their case against the suspects.
Local authorities have noted that this case represents one of the larger cryptocurrency-related crimes on Jeju Island, which has become increasingly popular with international visitors and business travelers.
The suspects remain in custody as the investigation continues. Police are examining security camera footage from the hotel and surrounding areas to piece together the complete sequence of events.
Questions remain about the exact nature of the transaction and how it was arranged. The police have not yet released information about whether the dealer was operating as part of a registered business or as an individual.
