South Korean CEO arrested in $366m crypto scam

The CEO of South Korean tech firm Wacon has been arrested for allegedly being behind a massive cryptocurrency scam that defrauded more than 500 investors.

CEO Byun Young-oh, along with an accomplice identified as Yeom, orchestrated a Ponzi-style scheme through a platform called MainEthernet.

Wakon, which reportedly has around 12,000 members, is suspected of operating as a Ponzi scheme or multi-level marketing campaign. The company offers virtual currency betting products, including tipping and mainnet businesses, without registering with financial authorities. It has branches across South Korea.

Crypto Chaos: Wacon CEO Caught Stealing $366 Million!

Big news from Seoul: Wacon CEO Byun Young-oh has been accused of running an epic $366 million Ethereum-themed scam.

The scam ensnared more than 500 investors, mostly boomers, and is a classic… pic.twitter.com/JEaxgo2DPs

— Mario Nawfal’s Roundtable (@RoundtableSpace) August 12, 2024

The scam, which allegedly raised $366 million, primarily targeted senior citizens, with many of them promised interest rates between 45% and 50% on Ethereum (ETH) deposits.

Details of the scam

The platform, which functions as a digital wallet service, lured investors with promises of secure and lucrative returns, but by mid-2023, reports emerged that investors were unable to withdraw their funds.

Despite these concerns, Byun assured investors that the problems would be resolved within months. In November 2023, signs of the company’s collapse became apparent when MainEthernet’s Seoul office removed its signage.

The Seoul Central District Prosecutors’ Office has charged Byun and Yeom with fraud, and the case is expected to go to trial soon.

Prosecutors continue to investigate the scope of the scheme, trying to identify additional victims and potential accomplices. Byun has denied involvement in any Ponzi scheme, claiming he was unaware of such structures. The investigation is ongoing.

Local media outlets Cheonji Daily and iNews24 assisted with this report.