Ex-Cyworld CEO Kim Ho-kwang Demands Probe Into RYSEN Token's Deceptive Investment Allegations

Woofun AI reports that a formal complaint document titled 'Request for an investigation into deceptive investment inducement involving RYSEN and Sigma Chain Cyworld' was filed by Kim Ho-kwang, former CEO of Cyworld Z, targeting Digital Asset. The filing demands an immediate probe into alleged deceptive investment solicitation practices surrounding the unlisted virtual asset RYSEN.

The core allegation centers on materials circulated under the Cyworld brand to induce purchases of RYSEN tokens. Kim argues that the token operates on the Sigma Chain mainnet and that its actual wallet operating model requires scrutiny. Authorities must determine if this structure falls under reporting requirements for virtual asset service providers (VASPs) under South Korean law.

Structurally, VASP registration is mandatory for entities handling virtual assets, making non-compliance a significant regulatory violation.

Woofun AI data shows that the Financial Services Commission and the Financial Supervisory Service are actively enforcing these rules. Operating without proper registration exposes entities to severe penalties, including criminal charges.

Notably, the use of the Cyworld name leverages trust from a dominant social platform in South Korea during the mid-2000s. Cyworld Z acts as a successor to the original service, which was overshadowed by global platforms before its revival in the blockchain space. This creates a consumer protection concern, as former users may be targeted based on residual brand trust.

A more critical variable is the internal leadership split, as Kim Ho-kwang's tenure as CEO ended recently. His public request for an investigation indicates a serious disagreement over the project's direction. The potential for criminal charges against those operating without proper registration adds weight to his demands.

This case sets a precedent for how unlisted tokens leveraging established brand names are handled regarding regulatory compliance. It underscores investor protection risks and signals tighter regulatory enforcement in South Korea. Stakeholders will monitor the outcome to gauge future implications for legacy tech brands in crypto.