South Korea turns to AI to speed crypto market investigations

The Financial Supervisory Service (FSS) said the upgraded tooling adds automated detection algorithms designed to identify manipulation windows inside trading datasets that investigators previously had to isolate manually. One technique described involves a “sliding-window grid search” approach that scans across many possible sub-periods within a dataset, looking for statistically abnormal patterns consistent with tactics such as coordinated trading bursts, wash-style activity, or other forms of engineered price moves.

Push comes as South Korea tries to tighten oversight of a retail-heavy market structure where liquidity can concentrate quickly on a small set of venues and tokens, and where abusive behavior can play out through fast, repeated order placement and cancellation or synchronized account activity. The FSS has framed the upgrade as a response to the operational limits of manual review when trading data spans multiple exchanges, multiple timeframes, and increasingly automated strategies.

Budgeting and rollout details also point to a program rather than a one-off tooling change. Reporting tied to the upgrade described a ₩170 million (about $116,000) allocation for 2026 to improve AI performance, with additional features planned to ship in phases through the year. Those future modules are expected to broaden surveillance beyond pattern detection toward mapping networks of related accounts and improving traceability around flows linked to suspected manipulation and other unfair trading.

For market participants, the immediate practical implication is a higher probability that short-lived manipulation attempts get surfaced while the trail is still fresh. In crypto, many abusive strategies rely on brief windows—minutes or hours—where liquidity is thin enough to push price, trigger liquidations, or influence reference rates before attention shifts. A system that can exhaustively search for those “best-fit” windows, rather than waiting for an investigator to guess the right interval, is meant to reduce that advantage and increase the odds that suspicious bursts are captured as part of a coherent pattern.