Key takeaways:
- South Korean authorities reportedly detained Jinwook Shin, the CEO of cryptocurrency exchange Bitsonic.
- Shin is suspected of taking investments and deposits from exchange users.
South Korean authorities reportedly detained Jinwook Shin, the CEO of cryptocurrency exchange Bitsonic, on August 7.
Shin is suspected of taking investments and deposits from exchange users, according to a report from the South Korean news outlet Chosun Biz. Without a pretrial hearing, the vice president of Bitsonic will also be tried.
Prosecutors claim that between January 2019 and May 2021, Shin engaged in deceptive trading volume and price manipulation on Bitsonic, defrauding users of the exchange of the equivalent of 10 billion won ($7.5 million). An official from the prosecution said:
“Shin tried to artificially increase the price of self-issued cryptocurrencies by manipulating the system computer and using cross-trading by taking advantage of the fact that he is both operating a virtual asset exchange and issuing cryptocurrencies.”
Bitsonic’s CEO kept promoting cryptocurrency to potential customers even after liquidity problems started and withdrawals were suspended.
Along with executing a program to buy the cryptocurrency held by Shin on the exchange system, Mr. A, the firm’s vice president, is also charged in the inquiry, which was launched in 2021.
Shin is also accused of manipulating the market by using a paper business he founded in Singapore. Additionally, it was discovered that foreign companies were employed in the crime, for example, by inflating the transaction volume by buying vast quantities of cryptocurrencies through a Singapore paper company.
Operating at a halt since August 2021, Bitsonic cited “internal and external issues.” The exact time frame saw 11 local cryptocurrency platforms being shut down by South Korean police due to fraud.
In July, South Korean officials started looking into the crypto lending company Delio. The CEO and other members of the company’s leadership staff are not permitted to leave the country.
South Korea recently established an interagency investigation team to combat cryptocurrency crimes and address the surge in illegal activity on the market and the requirement for investor protection.
