World’s 4th Largest Crypto Exchange Raided over Fraud Charges, Market Goes Deep Red

By Casper Brown
Published May 11, 2018 Updated May 11, 2018
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World’s 4th Largest Crypto Exchange Raided over Fraud Charges, Market Goes Deep Red

By Casper Brown
Published May 11, 2018 Updated May 11, 2018

Amidst the ongoing domestic exchange investigations in South Korea, country’s largest cryptocurrency exchange Upbit has been raided by the authorities over the suspicion of fraudulent activities.

South Korea’s largest crypto exchange under investigation

South Korea’s largest cryptocurrency exchange Upbit has been raided by the South Korean authorities over suspected fraud. Last year, in December, Upbit was also at the center of controversy when the exchange refused to join other exchanges in self-regulation support.

Upbit is world’s fourth largest cryptocurrency exchange by 24-hour trading volume as per Coinmarketcap that has over 250 cryptocurrencies listed on its platform. In the past 24-hours, the exchange has hosted over $1.8 billion of cryptocurrency trading. The investigators from the Prosecutors Office of the southern district of Seoul searched the head office of the exchange in the Gangnam-gu district.

Reportedly, Upbit has been suspected of fraud for allegedly selling cryptocurrency to people who are not its customers. Whereas, some reports also suggest that the exchange has been transferring the funds from its customer accounts to a separate account which belongs to an Upbit executive. There is no confirmation on the basis of the investigation yet.

The public prosecutor’s’ office sent investigators and prosecutors to Upbit headquarters on May 10 and May 11 to secure the hard disks and accounting records as stated:

“We have secured hard disks and accounting books through confiscation. Analysis is expected to take days. “

Also, read: SEC Addresses Crypto: SEC Commissioner Raises a Flag of Hope for Crypto Industry

South Korean authorities taking a strict approach

At the time, there has been nothing from the Upbit side as its representative said they can’t answer anything about the seizure.

Since March, the prosecutors have been investigating the domestic exchanges among which three unnamed crypto exchanges were raided on the suspicion of draining money from customers’ account. Last month, the chairman of Coinnest, Kim Ik-hwan was detained for fraud and embezzlement charges.

The South Korean authorities have been investigating the cryptocurrency exchanges as part of its regulatory tightening in the country. In order to fight illegal activities like money laundering and excessive speculation, the authorities crackdown on the exchanges.

It all started when at the end of last year, trade volume on local exchanges increased substantially. This boom alerted the authorities which led to the clampdown resulting in the drop down in crypto prices and trading activity.  

Currently, the entire cryptocurrency market is in deep red except two or three coins with Bitcoin going below $8,800 price level and Ethereum and Ripple taking a hit of about 8% and 14% respectively.

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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Casper Brown
382 Articles
I am an associate content producer for the news section of Coingape. I have previously worked as a freelancer for numerous sites and have covered a dynamic range of topics from sports, finance to economics and politics.

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