South Korean Authorities Arrest Crypto Exchange Chief on Suspected Multi-Million

[NewspaperD2]

On August 7th, Jinwook Shin, the CEO of Bitsonic, a cryptocurrency exchange, was apprehended by South Korean law enforcement. The arrest stems from allegations of embezzlement involving investments and deposits made by users of the exchange.

According to a report from South Korean news agency Chosun Biz, Shin is accused of orchestrating counterfeit activities, including manipulating cryptocurrency prices and trading volumes on Bitsonic. These actions report led to the misappropriation of approximately 10 billion won ($7.5 million) from exchange users between January 2019 and May 2021.

Prosecutors have claimed that Shin operated Bitsonic during this period but refrained from purchasing cryptocurrency. Despite encountering liquidity issues and suspending withdrawals on the platform, Shin allegedly continued to provide cryptocurrencies to new customers.

Bitsonic, which ceased operations in August 2021 "internal and external issues," saw further controversy when 11 domestic cryptocurrency platforms were shut down by South Korean authorities for meaningful counterfeit behavior.

The investigation also implicated the company's vice president, who is said to have played a role in a scheme to acquire crypto assets held by the CEO within the exchange system. This manipulation purportedly involved the use of a shell company based in Singapore.

Meanwhile, the vice president of Bitsonic is expected to face trial without being held in preliminary detention.

South Korean authorities have recently taken a firm stance against counterfeit activities within the digital asset. Notably, the Korea Securities Depository partnered with Code, a firm specializing in Travel Rules, to promote the issuance and use of Legal Entity Identifiers (LEI) within the virtual asset market. This collaborative effort to curb unlawful activities in the market while enhancing investor protection.

Furthermore, reports suggest that the Korean government is developing a crypto-tracking system to combat cybercrime and bolster security measures within the cryptocurrency landscape.