South Korea Dismantles $113M Crypto Laundering Ring Using Peeling Chains

South Korean authorities have uncovered a sophisticated $113 million cryptocurrency laundering operation that exploited virtual asset accounts and domestic bank withdrawals. The four-year scheme utilized peeling chains—a method of fragmenting transactions to obscure fund trails—while leveraging Chinese payment platforms WeChat Pay and Alipay for cross-border remittances.

The network allegedly processed illicit transactions tied to trade payments, duty-free purchases, and education fees, with some funds funneled through a plastic surgery clinic to mask origins. Seoul's Main Customs Office referred the case to prosecutors after tracing the Flow of overseas-purchased digital assets converted into Korean won.

This enforcement action coincides with heightened surveillance by South Korean regulators as suspicious crypto activity surges. The operation highlights persistent vulnerabilities in foreign exchange monitoring systems that bad actors exploit through hybrid fiat-crypto channels.