A South Korean court has acquitted Jang Hyun-guk, the former CEO of blockchain gaming firm Wemade, of charges related to the manipulation of the WEMIX crypto token’s circulation, according to reports from local media outlets. The court’s decision brought an end to a nearly year-long legal battle.
Wemade’s Legal Tussle Comes to an End
The case against Jang Hyun-guk began when prosecutors alleged that under his leadership, Wemade unfairly sold over $200 million in WEMIX tokens in the market from February to October 2022, without complying with the disclosure requirements of South Korea’s Capital Markets Act.
The company allegedly used the tokens to invest in external funds and receive stablecoin loans, using Wemix as collateral. Prosecutors claimed that Jang had falsely announced a halt in liquidation for WEMIX tokens to stabilize prices and induce investor confidence in the asset.
However, the court found no clear evidence of intent to manipulate the market. The WEMIX token has faced significant challenges, including a 97% decline in value since its peak and a controversy surrounding a major crypto hack that resulted in over $6 million in losses.
The hack, which occurred in February, saw over 8.6 million tokens withdrawn due to an attack on the blockchain gaming platform’s Play Bridge Vault. The company was accused of covering up the incident, but Wemix Foundation CEO Kim Seok-hwan denied these allegations, stating that the announcement was delayed to avoid causing panic in the market.
Will the Case Resurface at a Higher Court?
The Seoul Southern District Court ruled that Jang did not intend to influence crypto market prices using deceptive means, thus clearing him of violating the country’s capital market laws. This significant legal victory for Jang comes after a prolonged period of uncertainty.
Despite the verdict, prosecutors can still file an appeal to a higher court if they disagree with the ruling. The acquittal highlights the complexities and challenges of regulating the rapidly changing crypto market.
Recent prolonged court cases, such as this one, demonstrate the need for clear guidelines and regulations in the crypto industry. As the market continues to grow, companies and individuals need to understand their obligations and responsibilities under the law.
The outcome of cases like Wemade Ex-CEO Jang Hyun-guk’s acquittal will likely shape the future of digital asset regulation and enforcement in South Korea and beyond. With the WEMIX token currently trading at $0.63, investors and market observers will be watching closely to see how this development impacts the company’s prospects.
