Korean prosecutors have accused Chang Hyun-guk, the former CEO of the gaming company Wemade, of making up and hiding information about the circulation of Wemix tokens connected to the business.
According to Korea JoongAng Daily, the accusation released today accuses Chang of misleading investors by not disclosing large sales of Wemix tokens, even though he promised in February 2022 to stop these sales and make all circulation data public.
Legal Action Details
It’s been almost a year since Wemix investors first brought their worries to court in May 2023. Wemade is a Korean gaming giant that was formed in 2000. In 2020, it started giving out Wemix tokens to support its play-to-earn video games. Between November 2020 and November 2021, the business sold 108 million tokens and made about ₩290 billion, which is more than $210 million. After this, Wemade promised to stop selling tokens and share information about how many were in circulation.
Prosecutors say that between February and October 2022, Wemade continued to sell Wemix tokens worth ₩300 billion without telling anyone about it. It is also thought that the company used these tokens to invest in outside funds and get loans by putting up Wemix as protection.
Because of these problems with regulations, the Digital Asset eXchange Alliance, which is made up of Korea’s five most significant cryptocurrency platforms, took Wemix off their list. After Wemade made it clear that it had stopped selling the token on the market, the token was later put back on the list. Chang Hyun-guk is now vice president of Wemade after stepping down as CEO in March.
