If a loss occurs while trading virtual assets on someone's behalf, does legal liability arise?

Even where a loss occurs while trading virtual assets on another's behalf, criminal liability such as the crime of fraud may be at issue depending on the conditions at the time the funds were received.

Where a person receives funds after explaining, while trading virtual assets on another's behalf, that a certain profit is guaranteed or that no loss will occur, the investor is deemed to have entrusted the money in reliance on that explanation.

If a loss subsequently occurs and the investment cannot be returned, a deceptive act at the time of receiving the funds may be found, so the conduct may constitute the crime of fraud under the Criminal Act, punishable by imprisonment for up to 20 years or a fine of up to 50 million won.

On the other hand, if the structure was one in which the funds were entrusted on the premise of the possibility of loss, there are cases where it does not lead to criminal punishment, but a separate civil dispute over whether the investment must be returned may arise.

Ultimately, the criterion for judgment is not the result but what conditions and explanations existed at the time the money was received.

In a situation like this, it is necessary to organize matters in the following steps.

① Organizing the terms of the agreement at the time the funds were received

You should first organize under what conditions the money was actually received, based on whether profits were guaranteed, whether there was an agreement to return the principal, and whether the possibility of loss was disclosed.

② Securing evidentiary materials

You should secure materials that can confirm the flow of funds and the agreement, such as KakaoTalk conversations, account transfer records, and promises to distribute profits.

③ Assessing whether there is a criminal risk

You should review the possibility that the crime of fraud is established, depending on whether an element of profit guarantee or deception is involved.

④ Setting the direction of response according to the type of dispute

You should distinguish whether there is a possibility of it leading to a criminal matter or whether it is a case that will develop into a civil dispute over return, and set the direction of response accordingly.

Rather than the loss from trading virtual assets itself, the structure of the agreement at the time the funds were received is the key issue, and because whether criminal liability arises is determined on this basis, you can respond wisely if you organize the facts through legal review.

Daeryun, the ninth-ranked law firm in Korea (based on 2025 value-added tax filings with the National Tax Service), analyzes various issues and prepares legal response measures.