According to a report from The Block on January 10, South Korean K-pop giant Cube Entertainment's joint CEO and largest shareholder, Hong Seung-seong, has been accused of misleading investors into investing in the cryptocurrency Nestree. According to the Korea Economic Daily, Cube invested 100 million won (approximately $68,000) in Nestree Media Group in March 2022, after which the price of Nestree skyrocketed nearly tenfold to 50 won within a month.
Victims claim that Hong Seung-seong promised capital protection during the price surge, but denied the related commitments when the price of Nestree plummeted to single digits. Currently, the price of Nestree has fallen to 4.9 won, and investors are considering legal action. Hong Seung-seong denies the allegations, stating that this is part of the company's blockchain business expansion plan.
As a result, a Cube Entertainment, listed on Kosdaq, saw its stock price drop by 1.9% to 14,450 won on Friday, with a year-to-date decline of 7.4%. The company currently manages well-known artists such as (G)I-DLE and Pentagon, with revenue reaching $109 million in the first three quarters of 2024.