Jang Hyun-guk, the former CEO of Wemade and current CEO of NEXUS, has been acquitted in the first trial regarding allegations of providing false disclosures concerning the circulation volume of the cryptocurrency WEMIX.

The trial for the violation of the Capital Markets Act involving Jang Hyun-guk took place at 2:00 PM on the 15th at the Seoul Southern District Court. Jang Hyun-guk and legal representatives for Wemade were present as defendants. During the sentencing hearing held in April, the prosecution had demanded a five-year prison sentence and a 200 million won fine for Jang Hyun-guk, along with a 500 million won fine for Wemade.

The prosecution's core argument rested on the claim that WEMIX and Wemade's stock prices were effectively 90% correlated, moving in lockstep. Based on this, the prosecution argued that Jang Hyun-guk violated the Capital Markets Act by reneging on public statements that WEMIX would not be liquidated, thereby infringing upon the interests of investors.

However, the court ruled that this case did not constitute a violation of Article 178 of the Capital Markets Act. The court reasoned that the act only applies to financial investment products, and as a virtual asset, WEMIX does not fall under that scope. Furthermore, the court noted that Wemade stock and WEMIX differ significantly in terms of their issuers, nature, and investor demographics.

The court further determined that approximately 80% of Wemade's operating profit originated from its gaming division, and the 2021 stock price surge could not be attributed solely to the WEMIX token. Additionally, the court rejected the prosecution's logic that a decline in WEMIX price is inherently linked to a drop in Wemade's stock price, effectively dismissing the argument that the two assets are intrinsically tied.

The court did add a caveat, stating, "While we now have the Virtual Asset User Protection Act, such legislation did not exist at the time of these events." The court further remarked, "If the same actions were taken today under the current User Protection Act, the legal assessment might differ, but that falls outside the scope of this particular court's judgment."

Jang Hyun-guk was indicted without detention in August of last year on charges of violating the Capital Markets Act. The prosecution alleged that in early 2022, Jang Hyun-guk announced a halt to WEMIX token liquidation to induce purchases from investors, thereby defending Wemade's stock price and preventing a decline in WEMIX market value for personal benefit. The prosecution claimed that contrary to these announcements, Jang Hyun-guk liquidated approximately 300 billion won worth of WEMIX tokens between February and October 2022 through fund investments and collateralized loans. Throughout the trial, Jang Hyun-guk consistently denied all charges.

Speaking at a press conference, Jang Hyun-guk stated, "I would like to offer my apologies to other investors who must have suffered through a difficult time." Jang Hyun-guk added, "As you are aware, this case originated from the so-called 'Kim Nam-kuk coin' incident two years ago, and an investigation that should have resulted in innocence reached this point." Jang Hyun-guk also remarked, "Knowing what I had done, I have since started a new company in January."