Allegations of Upbit Listing Deal Surface in Lee Hee-jin Fraud Trial

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Allegations of Upbit Listing Deal Surface in Lee Hee-jin Fraud Trial

New allegations of a backroom deal involving Upbit operator Dunamu have emerged during the fraud trial of Lee Hee-jin, a prominent figure in South Korea’s cryptocurrency scene. According to a report by JTBC, Lee, who is facing trial for an alleged 90 billion won ($65.2 million) cryptocurrency fraud scheme, met with Dunamu’s Chief Operating Officer under circumstances that have raised questions about the fairness of certain coin listings on the Upbit exchange.

The Alleged Meeting and Coin Listings

Lee, widely known as the “Cheongdam-dong stock millionaire,” is accused of defrauding investors through a complex cryptocurrency scheme. The new allegations suggest that Lee met with Dunamu’s COO, identified only by his surname Jeong, in a hotel suite in Gangnam, Seoul, on July 1, 2020. One week later, on July 8, 2020, a coin called GOM2 — held under a borrowed name by Lee — was listed on Upbit. Another coin associated with Lee, PICA, was listed six months later in January 2021.

The timing of the listings, so soon after the private meeting, has fueled speculation that a deal was struck to facilitate the listings in exchange for undisclosed benefits. Lee’s trial is centered on allegations that he manipulated the market and defrauded investors, and these new claims add a layer of complexity to an already high-profile case.

Dunamu’s Response

In response to the JTBC report, Dunamu issued a statement acknowledging the meeting but denying any impropriety. The company said the meeting was based on a past relationship and a belief that Lee had turned over a new leaf. Dunamu explicitly denied any solicitation related to the listings, asserting that the coin listings followed standard internal procedures.

“The meeting was held based on a past relationship and a belief that Lee had turned over a new leaf,” a Dunamu representative told JTBC. “There was no solicitation related to the listings.”

Why This Matters for the Crypto Industry

The allegations, if proven, could have significant implications for the South Korean cryptocurrency market, which is one of the most active in the world. Upbit is the largest exchange in South Korea by trading volume, and any suggestion that listings can be influenced by personal connections could undermine trust in the platform. The case also highlights the ongoing regulatory scrutiny of cryptocurrency exchanges in South Korea, where authorities have been tightening rules to prevent fraud and market manipulation.

For investors, the story serves as a reminder of the risks associated with less transparent cryptocurrency projects and the importance of due diligence. The trial of Lee Hee-jin is expected to continue for several months, and the emergence of these allegations could lead to further investigations into Dunamu’s listing practices.

Conclusion

The allegations of a backroom deal between Lee Hee-jin and Dunamu add a dramatic twist to an already high-profile fraud trial. While Dunamu has denied any wrongdoing, the timing of the coin listings and the private meeting have raised legitimate questions. As the trial progresses, the crypto community will be watching closely to see if any evidence emerges that could shake confidence in one of South Korea’s most powerful exchanges.

FAQs

Q1: Who is Lee Hee-jin?
Lee Hee-jin, known as the “Cheongdam-dong stock millionaire,” is a South Korean investor and social media personality currently on trial for an alleged 90 billion won ($65.2 million) cryptocurrency fraud scheme.

Q2: What are the allegations against Dunamu?
Lee is accused of meeting with Dunamu’s COO in a private hotel suite in July 2020, shortly before two of his coins, GOM2 and PICA, were listed on Upbit. The allegations suggest a backroom deal may have influenced the listings.

Q3: How has Dunamu responded?
Dunamu has denied any wrongdoing, stating that the meeting was based on a past relationship and a belief that Lee had turned over a new leaf. The company says the coin listings followed standard internal procedures.

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