Several Coinone executives may face imprisonment for allegedly accepting bribes to list digital currencies on their cryptocurrency exchange platform. The Seoul Southern District Court’s Chief Judge, Kim Ji-sook, has issued arrest warrants for these individuals and other executives of the exchange.
Prosecutors assert that the accused received billions of won in bribes to list specific cryptocurrencies on Coinone, one of South Korea’s leading crypto exchanges.
Coinone Employees Detained in South Korea
South Korean authorities have detained multiple Coinone employees, including Kim Mo and Hwang Mo, on bribery and breach of trust charges.
According to the court, Kim Mo violated the Concealment of Criminal Proceeds Control Act by accepting a bribe worth one billion won (approximately $760,000) from Hwang Mo to list digital currencies such as Pica Coin on the platform. Kim Mo has reportedly confessed to receiving the bribe.
On the other hand, Hwang Mo has been charged with breach of trust for bribing Kim Mo and other Coinone executives, collectively distributing two billion won (about $1.5 million).
Coinone is one of the largest cryptocurrency exchanges in South Korea. Following the implementation of stricter regulations in 2021, South Korean authorities required local crypto platforms to comply with more stringent rules. Coinone was among the few exchanges that completed the registration policies.
South Korea’s Crypto Industry Faces Security Challenges
In addition to the bribery scandal, South Korea’s cryptocurrency sector has faced other challenges, such as the recent hacking attack on the GDAC crypto platform.
Cybercriminals compromised the platform’s security and stole over $13 million of digital currencies, equivalent to 23% of its custodial assets.
As a result, GDAC implemented emergency measures, such as blocking deposits and withdrawals, reporting the incident to law enforcement agencies, and seeking assistance from competitor companies.
South Korean Authorities Step Up Efforts to Combat Cryptocurrency Crime
The South Korean government has become increasingly determined to address crime within the cryptocurrency sector. This determination has been fueled in part by the case of Do Kwon, the South Korean co-founder of Terraform Labs, who allegedly became a fugitive after the collapse of LUNA/UST.
Investors and agencies blamed the 31-year-old developer for the adverse event and demanded that he face justice for his actions. However, despite efforts by the South Korean Ministry of Justice and Interpol, Kwon evaded capture for months, potentially hiding in various locations worldwide, including Dubai, Singapore, Russia, and Mauritius.
In March, authorities finally arrested Kwon at Podgorica airport in Montenegro, Serbia’s western neighbor. American prosecutors have since charged him with securities fraud, commodities fraud, and conspiracy.
The Coinone bribery scandal and other recent incidents demonstrate the need for increased vigilance and regulation within the cryptocurrency industry. As South Korean authorities continue to crack down on illicit activities, the sector may face further challenges in maintaining trust and compliance.
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