Ex-Wemade CEO Jang Hyun-guk Acquitted of WEMIX Manipulation Charges
South Korean Court Clears Former Wemade CEO of WEMIX Manipulation Charges
Court Ruling Exonerates Jang Hyun-guk
A South Korean judicial body has found Jang Hyun-guk, the ex-CEO of the blockchain gaming company Wemade, not guilty of allegations related to the manipulation of the WEMIX cryptocurrency’s circulation. The Seoul Southern District Court determined that Jang did not act with the intent to mislead the market or influence cryptocurrency prices through dishonest practices.
Background of the Case
On August 5, 2024, Jang faced indictment for allegedly misrepresenting the actual circulating supply of WEMIX tokens. Prosecutors accused him of misleading investors by claiming he would cease token liquidation, which was purportedly intended to stabilize the token’s value and boost investor confidence. However, the court concluded that there was insufficient evidence to prove any intent to manipulate the market.
Allegations of Financial Misconduct
Prosecutors claimed that under Jang’s leadership, Wemade sold over $200 million worth of WEMIX tokens between February and October 2022 without adhering to South Korea’s Capital Markets Act disclosure requirements. The company was also accused of using these tokens for external investments and securing loans in stablecoins, leveraging WEMIX as collateral.
In light of these allegations, the Digital Asset eXchange Alliance, which includes major South Korean exchanges, decided to delist the WEMIX token in December 2023, following a court’s approval of the action.
Impact on WEMIX Token Value
The ongoing legal issues have significantly impacted investor trust in the Wemade project. Currently, the WEMIX token is valued at $0.61, representing a staggering 97% decline from its peak price of $24.71 recorded on November 21, 2021. Despite the court’s ruling in Jang’s favor, prosecutors retain the option to appeal the decision in a higher court.
Additional Controversies Surrounding WEMIX
In addition to the legal challenges faced by Jang, the WEMIX token has been embroiled in another controversy involving allegations of a cover-up following a significant hacking incident. On February 28, over 8.6 million tokens were stolen during an attack on the Play Bridge Vault of the blockchain gaming platform, resulting in losses exceeding $6 million.
The company faced criticism for delaying the announcement of the hack, which led to accusations of attempting to hide the incident. However, Wemix Foundation CEO Kim Seok-hwan defended the company’s actions, stating that the delay was intended to prevent market panic. Despite these reassurances, the token’s value dropped nearly 40% in the days following the attack.
Conclusion
As the situation continues to unfold, the future of the WEMIX token and the Wemade project remains uncertain. The legal and operational challenges faced by the company have raised questions about its viability in the competitive blockchain gaming landscape.
