Bitsonic executives are facing legal challenges in South Korea.
Jinwook Shin, the Chief Executive Officer (CEO) of the cryptocurrency exchange Bitsonic, has been arrested by authorities in South Korea over allegations of financial misconduct that reportedly involved siphoning off significant funds from the platform's users.
A report from the respected South Korean media source, Chosun Biz, stated that Jinwook Shin was taken into custody on August 7th, following an ongoing inquiry into alleged misappropriations at the crypto exchange.
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Alongside Shin, Bitsonic's vice president, known in reports as Mr. A, is also facing charges, though without pre-trial detention.
Prosecutors claim that between January 2019 and May 2021, Shin got involved in deceitful practices, deliberately manipulating crypto prices and trading volumes on the Bitsonic. This malpractice reportedly led to the embezzlement of approximately 10 billion won, which translates to about $7.5 million, from unsuspecting users.
What's even more concerning is that despite the firm facing liquidity challenges and halting withdrawals, Shin didn't refrain from promoting and offering crypto to new clients.
Mr. A, the company's vice president, was reportedly also involved in the scam. The vice president allegedly orchestrated a program that would purchase cryptocurrency that Shin held within the crypto exchange's ecosystem. Further deepening suspicions, it's alleged that Shin operated a shell company based in Singapore, which played a role in the manipulation scheme.
In light of these mounting challenges and likely legal pressures, Bitsonic suspended its operations in August 2021, attributing the decision to "internal and external" issues.
As the South Korean cryptocurrency arena undergoes a wave of regulatory scrutiny, the arrest of Bitsonic's CEO serves as a reminder of the challenges and vulnerabilities present in the rapidly evolving market. It underscores the government's commitment to ensuring transparency, trust, and safety of investors' interests.
