A crypto “mining farm” in Gwangju turned out to be a front for money-spinning of a different kind: illegal gambling.

On Wednesday, South Korean police busted a makeshift gaming room that funneled over $95,000 (₩140 million) through unlicensed machines under the pretense of mining crypto.

Gwangsan Police Station announced that they are investigating a man identified only as “Mr. A” for violating the Game Industry Promotion Act, per a local media report.

The suspect reportedly installed 50 modified gaming machines and two kiosks in an office in Gwangsan-gu earlier this month, running the site under the guise of a virtual currency exchange and mining operation.

Following the bust, authorities confiscated the gaming equipment and are expanding their investigation to identify possible accomplices.

“Mr. A” allegedly modified a free mobile game, charging players $38 (₩50,000) per hour to play, and rewarded them with cash based on their scores.

“We will actively block illegal gaming centers from reopening or spreading even after being cracked down on,” Chief Jeong Gyeong-ho said after the raid.

Another police official added, “We plan to continuously and strongly crack down on illegal gaming rooms that threaten the people’s economy.”

South Korea's gambling crackdown

South Korea has seen a rise in gambling operations that use digital fronts, from crypto mining to fake investment platforms, to dodge detection.

These setups often appear legitimate on the surface but exploit the regulatory blind spots between gaming, crypto, and financial services.

In November 2024, South Korean police arrested 12 operators and 191 gamblers connected to an illicit online betting network that handled more than $7.77 million (₩108.4 billion) in wagers.

The group reportedly used encrypted chat apps and exclusive invite-only recruitment to avoid law enforcement scrutiny.

And just last week, authorities in South Gyeongsang arrested 18 individuals for running illegal online casinos from the Philippines, laundering over $169.5 million (₩250 billion).

The operation lured gamblers through mass texts and internet cafés, an example of how global and tactical these shadow networks have become.