K-Pop Leader's CEO Accused in Major Cryptocurrency Scandal

Kang Seung-gon, CEO of Cube Entertainment, is under scrutiny following allegations of his involvement in a cryptocurrency investment scandal.

According to a report released by The Korea Economic Daily on January 9, 2025, Kang allegedly promoted investments in the cryptocurrency Nestree (EGG), launched by South Korean blockchain firm, Nestree Media Group.

He supposedly assured investors they were guaranteed quick returns. These claims have been denied by Kang, who maintains he never made such promises.

The controversy centers around a significant drop in the value of Nestree. After Cube Entertainment's reported investment of 100 million won ($68,000 USD) in Nestree Media Group in March 2022, the cryptocurrency's value soared, rising from 5 won to nearly 60 won per token.

However, the token's value later plummeted back to single digits, leaving investors with heavy losses. One investor reportedly lost over 70 million won (roughly $54,000 USD) and approached Kang to demand their principal be returned. However, Kang denied making such promises, calling the accusations "completely groundless." Kang has also denied any notion of profiting from Nestree, as he also lost money in the investment.

He has said that the investment is part of Cube's expansion into blockchain technology and confirmed the company's intention to continue collaborating with Nestree Media Group.

Despite Kang's rebuttals, investors are reportedly pursuing legal action, accusing him of misleading guarantees and potential market manipulation. Under South Korean law, such actions could carry serious consequences if proven. This case highlights growing scrutiny by South Korean regulators, who are actively cracking down on market manipulation in the cryptocurrency sector.

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