Bitcoin, Cryptocurrency And Blockchain News

Coinone Faces Charges for Allowing Crypto Margin Trading


Margin trading using cryptocurrency is an illegal act, according to the South Korean police department. Cryptocurrency exchange Coinone was providing such a service on its platform, which is why it’s facing charges by the criminal investigation team, as reported by South Korean news website Yonhap.

Three people will be sent to prosecution – one of them includes Myunghun Cha, CEO and founder of Coinone. Margin trading was offered on the exchange from November 2016 to December 2017. During this time, 19,000 customers used this service, while 20 top customers were responsible for trading 3 billion won. The police is sending these 20 high-end traders, aged between 20s to 50s and ranging from employed to unemployed, to the prosecution as well.

Coinone denied these allegations and one of the representatives said, We do not think it is illegal because it has been legally reviewed by lawyers … Since we did not receive interest on the portion of the margin that allowed us to trade four times the margin, I can not see it.”

The police started investigating the platform in August, 2017 and after ten months of careful observation, they came to the conclusion that margin trading could be used to aid criminals. Many traders explained that they weren’t aware that margin trading was illegal.

When Coindesk reached out to Coinone, they said,“At this time we are focused on cooperating with the ongoing investigation, and will continue to do so as the case is in the process of moving over to the Prosecution Service from the Police Agency.”

Coinone was launched in 2014 and since then has been listed in the top 50 cryptocurrency exchanges on Coinmarketcap. The exchange opened one of its branches in Indonesia in April 2018. Pre-registration for the new exchange is live – 10,000 chosen users will also be able to partake in the Qtum airdrop. Until now, Coinone Indonesia has listed Bitcoin, Bitcoin Cash, Litecoin and Qtum.