Prosecutors have raided the operator of South Korea’s largest cryptocurrency exchange over suspicions it sold more virtual currencies than it held.
The Seoul Southern District Prosecutors’ Office sent inspectors to the office of Upbit in Seoul’s Gangnam District for a second consecutive day on Friday and secured computer records regarding market transactions.
The prosecution suspects the company sold more virtual currencies than it owned and thus committed fraud.
Upbit is the largest cryptocurrency exchange in South Korea and the fourth largest in the world. Dunamu, an affiliate of KakaoTalk, bought the company in December.
The prosecution plans to question Lee Seok-woo, the former CEO of KakaoTalk, who now heads up Dunamu, to see whether he was aware of the alleged illegal trading.
After the prosecution’s raid became known, the prices of most cryptocurrencies traded on Upbit plunged.