TLDR
- South Korean police arrested three suspects over a fake XRP staking site.
- Seventy-one victims sent 3.4M XRP worth about 12.3B won.
- Police say total damage may reach 27.3B won as more victims are investigated.
- Authorities froze 17.3B won in virtual assets within three days of a tip.
- Police are seeking an overseas suspect through an Interpol red notice.
South Korean police have arrested three suspects accused of stealing about 12.3 billion won in XRP through a fake staking site that promised fixed monthly returns.
Police Say Fake FXRP Site Targeted XRP Investors
The Seoul Metropolitan Police Agency’s Cyber Investigation Unit said the suspects were arrested on fraud-related charges. Two of them were sent to prosecutors under detention, while police continue investigating another suspect.
The case centers on a fake investment website called “Fxrpntwork.com,” which opened in October last year. Police said the group claimed investors could earn monthly returns of 1.5% to 1.8% by staking XRP through a new FXRP network.
Seventy-one victims transferred about 3.4 million XRP, worth nearly 12.3 billion won. Police said the wider damage identified so far may reach about 27.3 billion won, leaving room for more victims.
The suspects allegedly used the names of Flare Network and FXRP to make the site appear real. Flare Network is an existing blockchain network, while FXRP is an XRP-linked asset issued on that network.
Suspects Used Online Platforms and Fake Channels
Police said the group promoted the fake staking service through Naver Blog, Naver Knowledge iN, Tistory, online articles, Wikipedia, and YouTube. The suspects allegedly used channels with names such as “Upbit Developer Yu○○” and “Ripple Reader ○○.”
The promotional materials claimed FXRP staking could only be done through overseas exchange Binance. Police said this helped push victims to move XRP from domestic exchanges to wallets controlled by the suspects.
Investigators said the route through overseas exchanges was used to avoid South Korea’s Travel Rule checks. The rule requires exchanges to verify sender and receiver details for virtual asset transfers above 1 million won.
After receiving XRP, the group allegedly sold the assets through over-the-counter traders and converted them into won. The fake website disappeared less than a month after opening.
Police said the timing of the scam matched the actual launch period of FXRP-related products. Investigators believe the suspects used that timing to make the fake staking offer appear more credible.
Police Freeze Funds and Seek Overseas Suspect
Police opened the investigation after receiving information from overseas crypto exchanges about several FXRP staking fraud cases. Investigators used crypto tracking methods to follow the movement of stolen assets.
Within three days of receiving the tip, police froze about 17.3 billion won in virtual assets across several overseas exchanges. Authorities are now working to recover frozen funds and preserve criminal proceeds before prosecution.
Police also obtained an arrest warrant for a main suspect believed to be staying abroad. An Interpol red notice process is underway as investigators continue searching for that person.
The three main suspects identified so far are reportedly friends. Police are also investigating people accused of helping build the fake site and promote the scam online.
Lee Sook-young, head of the Seoul police cyber investigation team, warned investors about online fraud involving digital assets. She said, “As cyber fraud crimes using virtual assets have recently evolved in various ways, we urge you not to be misled by inaccurate information through YouTube channels, and to invest after acquiring accurate information.”
Lee also urged victims to report losses quickly. She said,
“If you have suffered damage, please report it to the investigative agency quickly.”
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