In a recent development reported by local news outlet The JoongAng, four individuals associated with Coinone, a prominent South Korean cryptocurrency exchange, have been indicted for allegedly engaging in illicit activities to profit from coin listings.
The individuals identified as Mr Jeon, Mr Kim, Mr Ko, and Mr Hwang, who were employees of Coinone, are said to have unlawfully gained over 2.98 billion Korean Won (approximately $2.26 million) during the period spanning November 2019 to December 2022. This incident involved nearly 25% of all tokens listed on Coinone, with at least 46 coins being implicated.
According to prosecutors, Coinone executives and staff members required projects to enter into market-making (MM) contracts with a specific MM company through brokers before their coins could be listed. The purpose of these contracts was to ensure sufficient liquidity and trading volume for the newly listed coins.
Coinone crypto exchange impacted by the manipulation
However, it is alleged that the recipients of these contracts engaged in illegal activities by artificially inflating trading volume and prices through cross-trading. The executives are also accused of enticing projects to sign the contracts by offering to waive “listing deposits” if they complied.
The four individuals, consisting of two senior executives and two brokers associated with Coinone, have been charged with breach of trust and obstruction of business in relation to their alleged market manipulation activities. Coinone, being a significant cryptocurrency exchange in South Korea, with a reported trading volume of $27.2 million in the past 24 hours, has been impacted by these actions.
Prosecutors have stated that the price manipulation carried out by the accused individuals has led to misconceptions about trading volume and market prices among general exchange members, ultimately luring them into participating in coin transactions and purchasing the manipulated coins
