The CEO of South Korean crypto exchange Bitsonic has been sentenced to a 7-year jail term for fraudulently manipulating markets and misappropriating customer funds. The Seoul Eastern District Court found Shin guilty alongside the platform’s technology vice president, who received a 1-year sentence.
According to a Yonhap News report, Judge Lee Jong-chae ruled that Bitsonic artificially increased trading volumes to deceive users, unlawfully obtaining over 10 billion Korean won. The sophisticated scheme spanning January 2019 to May 2021 involved using exchange capital to pump up the prices of Bitsonic Coin (BSC), its native token.
Fake cash deposits were also entered into Bitsonic’s to portray the illusion of legitimate transactions. Shin took advantage of the exchange’s credibility to orchestrate market manipulation.
The court slammed Bitsonic’s brazen exploitation of its position, severely eroding investor trust in crypto trading platforms. Citing charges including fraud and forgery, the verdict underscores the need to rein in exchange malpractices harming consumers.
On February 6, Seoul prosecutors arrested 3 executives of crypto staking firm Haru Invest, accused of haltering withdrawals in June 2022. The back-to-back developments highlight ever-present risks in decentralized finance.
As global regulatory reviews intensify, users must vet exchanges before investing thoroughly. The Bitsonic case demonstrates that even major players can defraud customers with weak oversight. Ensuring transparency and security compliance thus remains imperative.
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