The Korean Crypto Laundering Method Behind $6.4 Billion, and Why Police Struggle to Stop It

A single cross-border laundering method has quietly become the backbone of South Korea’s crypto crime wave, accounting for $6.4 billion of the $7.1 billion in illegal crypto transactions recorded in the country since 2021.

And despite knowing exactly how it works, police are struggling to stop it. The technique is called Hwanchigi.

It exploits cryptocurrency transfers to move illicit money offshore without touching South Korea’s regulated banking system, making it fast, borderless, and difficult to prosecute.

A Crystal Intelligence report tied the method to the vast majority of illegal crypto flows in the country between 2021 and August 2025, and new police data suggests its use is accelerating sharply.