South Korean Court Acquits Jang Hyun-guk
In a notable decision, a South Korean court has found Jang Hyun-guk, the former head of the blockchain gaming company Wemade, not guilty of manipulating the WEMIX cryptocurrency’s market circulation. The Seoul Southern District Court announced its ruling on Tuesday, indicating that there was insufficient evidence to support claims that Jang had engaged in deceptive practices to sway crypto market prices. This legal victory is particularly significant given Jang’s current role at Nexus, a blockchain gaming firm.
Background of the Case
The case dates back to August 5, 2024, when Jang was indicted for allegedly misleading investors about the true circulating volume of WEMIX tokens. He faced accusations of misinforming the public and not disclosing that the company continued to sell tokens after promising to halt these sales in February 2022. Prosecutors argued that under Jang’s management, Wemade had sold more than $200 million in WEMIX tokens between February and October 2022, while failing to meet the disclosure obligations mandated by South Korean law.
Impact on WEMIX Token and Investor Perception
In response to these allegations, the Digital Asset eXchange Alliance, a coalition of the country’s major cryptocurrency exchanges, removed the WEMIX token from trading platforms in December 2023, following a court ruling that endorsed this action. This decision has negatively impacted investor perception of Wemade, with the price of the WEMIX token plummeting to $0.61, a staggering 97% drop from its record peak of $24.71 on November 21, 2021.
Future of the Case and Additional Controversies
While Jang has been acquitted, prosecutors still hold the option to appeal to a higher court should they choose to contest the ruling. Cointelegraph sought a response from Wemade regarding the case, but no comment had been received prior to the publication of this article.
Additionally, Wemix has been embroiled in further controversy due to alleged mishandling of information following a significant security breach that occurred on February 28, which saw the theft of over 8.6 million tokens from its Play Bridge Vault, equating to losses exceeding $6 million. Initial disclosures about the breach were made days later, raising accusations of a cover-up. However, CEO Kim Seok-hwan of the Wemix Foundation clarified that the delay was aimed at preventing market panic amidst the fallout from the hack. Nonetheless, the market responded with a nearly 40% drop in the token’s value shortly after the incident.
