Serious allegations against South Korea’s major K-pop industry player, Cube Entertainment, are mounting. This time, it involves its CEO, Kang Seung-gon. According to allegations, the CEO is behind a crypto pump-and-dump scheme linked to an investment in a blockchain firm called Nestree Media Group.
The controversy started in March 2022 when Cube Entertainment invested 100 million won for a 40% stake in Nestree, a firm that manages an online store using its namesake cryptocurrency token. Immediately following the investment, the price of the Nestree token skyrocketed by 100 times, leading many investors to be all aglow.
However, the celebration was short because the crypto crash saw Nestree’s value crater, wiping 90% for many investors off their investments. Some, like the investor who has lost more than $47,000, will claim Kang went about promoting this token with assurance of guaranteed profits and inside scoop.
Kang Denies Anything Wrong
Kang Seung-gon complained against such allegations as “completely groundless” and rejected having any hand in a pump-and-dump scheme. According to the executive of the company, Cube’s investment in Nestree is based on an initiative of a broader expansion strategy for blockchain technology, without any promised conditions for guaranteed returns.
These denials notwithstanding, the scandal raises questions about entertainment and cryptocurrency investments, especially at a time when Cube Entertainment might face legal action. The investors who lost their money in the scheme are now taking legal actions that could lead to a heavy fall for the company and even for South Korea’s regulatory framework of the crypto industry.Kang
This case sets a significant warning about risks in investment in cryptocurrencies as well as the demand for clear regulation in the sector as both the entertainment firms and investors struggle to go through the deeper complexities of blockchain technologies. The outcome of this situation may influence how the future is regulated regarding the crypto industry of the country.
Source: https://www.livebitcoinnews.com/cube-entertainment-ceo-kang-seung-gon-faces-scam-allegations/