South Korea’s financial watchdog has expanded the use of artificial intelligence to monitor digital asset markets, signaling a move toward automated, data-driven enforcement as trading activity becomes more complex.
The Financial Supervisory Service (FSS) said it has upgraded its Virtual Assets Intelligence System for Trading Analysis (VISTA), the model used to probe unfair crypto trading. The upgrade adds an automated detection algorithm that can identify potential price-manipulation periods without manual intervention.
From manual analysis to systemized oversight
The FSS said the new algorithm applies a sliding-window grid search technique to examine every possible sub-period within a trading dataset. This enables exhaustive searches for manipulation windows that investigators previously had to spot by hand.
In performance tests on closed cases, the system detected all manipulation periods found in prior investigations and also flagged additional suspicious intervals that traditional methods had missed.
The watchdog secured a 170 million won (about $116,000) budget for 2026 to further enhance AI performance. Additional capabilities will be rolled out in stages through the end of 2026. Planned upgrades include automated tools to identify networks of coordinated trading accounts, analyze abnormal trading-related text across thousands of crypto assets, and trace the origin of funds used in manipulation.
South Korea weighs pre-emptive freezes for suspected manipulation
The VISTA upgrade aligns with regulators’ broader aim to strengthen enforcement in the crypto market. Local reports on Jan. 6 said the Financial Services Commission (FSC) was considering a payment suspension system to block transactions before suspects can launder ill-gotten gains.
This crypto surveillance push runs alongside efforts to expand AI-based monitoring across South Korea’s capital markets. The FSC announced that the Korea Exchange will begin operating an AI-driven market monitoring system to improve early detection of stock price manipulation.
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