CEO of K-Pop Entertainment Firm Cube Accused of Involvement in Investment Scam

Kang Seung-gon, the CEO of Cube Entertainment, one of the K-pop giants, has been accused of being involved in a cryptocurrency investment scam.

Last Thursday, local South Korean media reported that Kang had been involved in a cryptocurrency scheme in March 2022. As an executive at Cube, Kang was accused of using the company's fame to intentionally inflate the price of a fraudulent crypto token while encouraging people around him to invest, causing investors to suffer losses after the token's price plummeted.

In March 2022, Cube invested 100 million won in South Korean blockchain company Nestree Group Media, gaining a 40% stake in the company.

After reports of Cube's investment, the blockchain company's cryptocurrency, Nestree (EGG), surged more than ten times from 5 won to 60 won within a month. But the following month, the token's price fell below 5 won.

Some Nestree investors have accused Kang of encouraging peopleto buy the EGG tokens before and after Cube invested in Nestree, as well as assuring people of a return on their initial investment.

However, an investor said that more than 70 million won had been lost due to Kang's promises. Another investor said, “In early 2022, Mr. Kang encouraged me to invest, saying, ‘I will guarantee the principal, so please trust me.’”

Kang denied the allegations and said he never made such a promise: “ there is no evidence that we recommended a cryptocurrency investment under the condition of a principal guarantee.”

He also denied that he and his company were involved in a cryptocurrency scam. He said that Cube's investment in Nestree was part of the company's expansion into the blockchain industry and the two parties plan to continue their business partnership.

When asked if he personally invested in EGG, he said, “I invested, but I lost money instead of making a profit by selling at the peak.”

Cube Entertainment is a medium-sized South Korean talent agency that produced well-known K-pop groups such as (G)I-DLE, 4minute, and BEAST.