According to TechFlow, on January 10, The Block reported that Hong Seung-sung, co-CEO and largest shareholder of South Korean K-pop giant Cube Entertainment, was accused of misleading investors to invest in the cryptocurrency Nestree. According to the Korea Economic Daily, Cube invested 100 million won (about 68,000 US dollars) in Nestree Media Group in March 2022, after which the price of Nestree currency soared nearly 10 times to 50 won in one month.
Victims said that Hong Chengcheng promised to protect the principal during the rise in the price of the currency, but denied the promise when the price of Nestree currency plummeted to single digits. Currently, the price of Nestree currency has fallen to 4.9 won, and investors are considering taking legal action. Hong Chengcheng denied the allegations, saying that this was part of the company's blockchain business expansion plan.
As a result, Cube Entertainment's shares closed down 1.9% to 14,450 won on Kosdaq on Friday, down 7.4% year-to-date. The company currently manages well-known artists such as (G)I-DLE and Pentagon, and its revenue in the first three quarters of 2024 reached US$109 million.