Korbit exchange will soon seize assets to pay crypto fraud victims

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Korean cryptocurrency exchange Korbit has revised its terms of service, introducing new measures to protect the victims of crypto fraud.

The exchange, considered to be a substantial player in the Korean market, added new conditions to its terms of service, equipping itself with greater powers for tackling fraudulent behavior on and through its platform.

According to a notice published by the exchange today, the updated terms of service give the exchange the authority to seize funds and cryptocurrency from its users at the direction of “financial authorities.”

The mechanism is designed to provide a means of redress for victims of crypto fraud. It comes at a time of rampant criminality in the cryptocurrency, with a growing number of scammers and fraudsters using cryptocurrency to defraud their victims.

In particular, the clause is described as being for the benefit of “victims of financial fraud”:

“The Company may collect funds and virtual assets from fraud or other crimes and pay them to the victims upon request of the financial authorities or financial institutions.”

The terms will come into force from February 24. Users of the exchange are deemed to have accepted the new terms if they don’t terminate their service agreement no later than one day prior to the new terms coming into force.

The change is set to affect all users of the exchange, and comes as the most significant adjustment to the terms of service since February 2019.

It comes against a backdrop of growing concern over crypto fraud and scamming in South Korea, and indeed across the wider world.

Once implemented, the measure is expected to be used by the exchange to reimburse victims of crypto fraud, empowering the operator to take control of any assets it can to refund those at a loss from their cryptocurrency dealings.