Upbit, the largest South Korean cryptocurrency exchange is under siege by the prosecutor for suspected fraud.
News reports from the Korean media that the company is suspected of transferring customer funds from its cryptocurrency account to an account of an Upbit representative or executive.
On 10 and 11 May, a team of 10 financial investigators from the South Seoul District Public Prosecutor’s Office sent prosecutors and investigators to Upbit’s headquarters in Gangnam-gu district.
The team would have seized the hard drives and accounting records. The accusation entered the computer system to see if Upbit had the cryptocurrencies that it did not actually own.
Exchange customers are conducting their own investigation.
The first objective of the investigations was Coinnest, while last month Kim Ik-hwan, president of Coinnest, was arrested on charges of embezzlement and fraud. Kim was handed over to the court for alleged theft against clients transferred to his personal account.
Meanwhile, the cryptocurrency market is undergoing a correction in the last 24 hours.
While everyone is wondering what could be a possible reason for this decline, this would seem a plausible hypothesis.
Korean UpBit offers a single trading account type with no leveraged trading option and charges some fees for its services. Over 120 cryptocurrencies are listed on the platform, and besides, it supports the local currency, South Korean Won (KRW).
Keep in mind that this exchange is intended only for Koreans and that ID verification is obligatory.