South Korean police recently raided the offices of the sports-themed blockchain platform Winnerz as part of an investigation into claims that its WNZ token is a “scam coin.” The Seoul Metropolitan Police Agency’s criminal task force searched and seized evidence from two locations, including a Winnerz office in Gangnam, Seoul, and the home of the former Winnerz CEO Choi Seung-jeong. The police obtained a court warrant to search the premises on suspicions of fraud and coercion under the Act on Aggravated Punishment for Specific Economic Crimes. The probe into Winnerz and Choi has been fueled by allegations of operating a “multi-level scam” operation and controversy surrounding a token called Golden Goal (GDG), which some have labeled as a “scam coin.”
Several South Korean celebrities, sports stars, and social media personalities have denied any involvement with Choi and Winnerz amid the controversy. K-pop stars Choi Si-won and Cho Hyun-young, in particular, have refuted claims that they promoted so-called South Korean “scam coins.” Despite WNZ being listed on overseas crypto exchanges, numerous South Korean investors have filed complaints about the token to the regulatory Financial Services Commission (FSC), prompting the FSC to pass the case on to the police. The police are also investigating two additional complaints related to WNZ independent of the FSC’s request. It is believed that Choi was previously responsible for promoting GDG, which has been described as a crypto fraud worth billions of KRW.
The Golden Goal CEO, surnamed Kim, was arrested by police on fraud-related charges on March 28, while the Seoul Southern District Prosecutors’ Office’s Virtual Asset Joint Investigation Unit – the nation’s top anti-crypto crime division – has initiated an investigation into Choi on similar fraud charges. The news of these developments has caused WNZ prices to plummet. Despite the controversies surrounding Winnerz and Choi, K-pop stars such as Choi Si-won and Cho Hyun-young have denied any association with the “Winnerz Coin controversy.” The investigations into Winnerz and Golden Goal highlight the broader issue of fraudulent cryptocurrency schemes and the need for regulatory oversight to protect investors and maintain the integrity of the industry.
The viral anonymous post from a group of investors accusing Winnerz of operating a scam operation in February ignited further scrutiny into the platform and Choi. The controversy has raised questions about the legitimacy and transparency of Winnerz and its associated tokens, particularly WNZ and GDG. The police raids on Winnerz offices and Choi’s residence reflect the seriousness of the allegations against them and the authorities’ determination to uncover any fraudulent activities. Despite the denials from South Korean celebrities linked to Winnerz, the investigations into the platform and its tokens continue, with the police focusing on potential fraud and coercion offenses under the country’s economic crime laws.
The involvement of high-profile individuals like K-pop stars in the “scam coin” controversy has drawn significant attention to the issue and highlighted the risks associated with cryptocurrency investments. The regulatory authorities in South Korea are actively pursuing cases of suspected fraud in the cryptocurrency sector, as demonstrated by the investigations into Winnerz and Golden Goal. The crackdown on alleged fraudulent activities aims to protect investors from financial losses and prevent further proliferation of scam coins in the market. The outcome of the investigations into Winnerz and its tokens will have broader implications for the cryptocurrency industry in South Korea and may lead to stricter regulations to safeguard investors and maintain market integrity. As the investigations unfold, the authorities will continue to collaborate with relevant stakeholders to address any fraudulent practices and uphold the credibility of the cryptocurrency market.
