Four individuals have been identified in connection with a listing scandal at South Korean crypto exchange Coinone, The JoongAng said on May 21.
Two executives, two brokers charged
According to prosecutors, Coinone list team leader Kim Mo and Coinone list broker Hwang Mo have both been charged. Two others were also charged.
Coinone’s former Chief Sales Officer (CGO), Jeon Mo-ssi, was also investigated three times in March and April, though it is unclear if he has been charged.
Coinone executives accepted payment to list at least 46 of the cryptocurrencies now available on their exchange. That number represents 25% of all cryptocurrencies listed on Coinone, though prosecutors say this number could increase as the investigation continues.
In total, Coinone members received a total of 2.98 billion won ($2.27 million) in exchange for listing the relevant cryptocurrencies.
Coinone engaged in market manipulation
In addition to demanding payment from parties who wanted their coin on the list, Coinone encouraged some parties to facilitate market manipulation.
Coinone executives reportedly encouraged parties on the list to sign a contract that forced them to submit orders through market-making firms. The market maker then manipulated prices and falsely increased trading volumes through cross-trading. In exchange for signing those contracts, Coinone waived the down payment for the listing party.
The market manipulation described above misled exchange users about the volume and price of the relevant cryptocurrency, prosecutors said.
Officials said they have not previously prosecuted a fraud case against common investors related to illegal market making in the crypto market.
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