South Korea rocked by alleged celebrity crypto scandal

South Korea has been hit by an alleged crypto scandal linked to many popular celebrities and YouTubers involving the promotion of a fraudulent scheme.

According to a report published in The Korea Herald, Winnerz — a blockchain sports platform based in South Korea that runs multiple businesses, including cryptocurrency issuance — is accused of operating a coin scam. The alleged fraud came to light after anonymous investors complained that the company was issuing fake cryptocurrency, collecting investments and preventing investors from withdrawing their money.

The scheme was reported to the National Police Agency on Feb. 5 after being reported to the National Civil Service earlier.

Winnerz is accused of promoting its fraudulent scheme with the help of popular celebrities and YouTubers who could either buy the coins themselves or help recruit more investors for a commission. Speculations around the involvement of celebrities with Winnerz arose after users found pictures of celebrities like comedian Na Sun-uk at Winnerz’s year-end party.

One of the key representatives of Winnerz, Choi Seung-Jung, whose photos with the celebrities raised alarms, has been accused of running a slew of crypto token frauds, including the GDG and TYP coin fraud.

The use of celebrities to promote a fraudulent project is not limited to Korea or the crypto market but has been a popular tactic for years. Celebrities like Kim Kardashian and Floyd Mayweather have been prosecuted and fined for promoting fraudulent crypto schemes.

Related: South Korean officials to disclose crypto assets in 2024

Most celebrities accused of promoting or being involved with Winnerz have denied any links to the firm. However, others have also revealed that they have invested in the alleged fraudulent crypto. Sun-uk and popular YouTubers Kim Won-hoon and Cho Jin-se denied any investment or involvement with the controversial project. They claimed their attendance at the event was due to other personal commitments.

Another popular Korean YouTuber with two million subscribers, Oh Byeong-min, revealed that he has invested in the Winnerz project after users found his name listed as one of the company’s directors. However, due to the ongoing controversy around the project, the YouTuber also announced his departure, claiming he had stopped “all projects with Winnerz and have no plans to collaborate with Winnerz in the future.”

Cointelegraph reached out to Byeong-min and Won-hoon for comments but have yet to receive a response.

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