South Korean Crypto Executives Accused of $2.2m Scandal

South Korean Crypto Executives Accused of $2.2m Scandal


Four employees of South Korean crypto exchange Coinone have been indicted for allegedly employing illegal methods to amass profits exceeding 2.98 billion Korean won during coin listings, raising concerns about the integrity of the market and the trust placed by investors and traders in cryptocurrency exchanges.

Four employees of South Korean cryptocurrency exchange Coinone have been indicted for allegedly employing illegal methods to amass profits exceeding 2.98 Billion Korean won ($2.26 million) during coin listings from numerous projects.

The information was informed by local news outlet The JoongAng on May 22.

Market making 

Along with the implications for Coinone and the individuals involved, the recently revealed incident of market manipulation carries broader ramifications for the industry of digital currency as a whole.

Coinone, as a major digital currency exchange in South Korea, plays a whole lot of role in the market.

The local news release from May 22, 2023, mentions the involvement of 46 coins in this illicit scheme, accounting for approximately 25 percent of Coinone’s crypto token listing portfolio.

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The incident, which spanned from November 2019 to December 2022, raises concerns about the integrity of the market and the trust placed by investors and traders in digital currency exchanges.

The alleged orchestration of the scheme by Coinone executives and staff members during the coin listing process outlines the  capacity vulnerabilities within the industry.

By entering into market making contracts with specific corporations, the aim was to sustain volume of trading and prevent a decline in transaction charges following the listing of new coins.

“This price manipulation establish misunderstandings about the volume of trading and market value between general members of the exchange and induces them to join the coin transaction and buy the coin.”

South Korean prosecutors.

Facing charges of breach of trust and obstruction of business, two senior executives and two brokers from Coinone, a prominent South Korean digital currency exchange, have been implicated in the alleged market manipulation activities.

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Far-reaching consequences

In terms of  the actions of the individuals involved in the market manipulation scandal at Coinone, the repercussions extend beyond the immediate impact on the exchange itself.

Coinone holds a prominent position as one of the major digital currency exchanges in South Korea, with a substantial volume of trading of $27.2 Million in the past 24 hours.

Any illicit activities or fraudulent practices within such a prominent exchange can have far-reaching consequences for the entire digital currency industry.

Market manipulation during a major exchange not only undermines the integrity of the trading ecological system but likewise erodes investor confidence in the reliability and fairness of digital currency markets.

Source

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