Sudden Cyworld Shutdown Puts Clink Crypto Investors at Risk: Report
South Korean social media platform Cyworld has shut down operations prompting concerns about the future of its Clink cryptocurrency.
South Korea’s Cyworld social media platform shuttered its services on Oct. 1 without giving any prior notice, English-language local media The Korea Times reported on Oct. 14. What’s more, the website for its Clink (CKCT) crypto-asset has also become inaccessible.
In response to the news, local cryptocurrency exchanges supporting Clink, namely CoinZest and BitSonic, are now considering delisting the token. Moreover, some investors who bought Clink are reportedly considering filing a lawsuit against Cyworld and its CEO, Jeon Jae-wan.
Great losses are expected for investors
Unspecified industry officials reportedly estimate Clink investors to lose least 1 billion won (about $844,000) if the company does not set things straight.
Twenty-four million units of the crypto asset were sold at 26 won per unit ($0.022) in an Initial Exchange Offering conducted on CoinZest on Jan. 11. Collectively 480 million won ($405,000) worth of Clink has been sold.
Since then, Clink’s price has crashed 96% to 0.7 won on CoinZest, while being traded for 0.19 won on BitSonic as of Oct. 14.
According to The Korea Times, the company has seen a massive exodus of employees in the second half of this year when it delayed paying them since the end of 2018 after its newly launched online news service QUE failed to attract users.
Cyworld was a popular social media platform until the mid-2000s, having about 13 million users in 2005 according to The Age. Per the report:
“Almost every South Korean in their 20s has been a subscriber to the site, according to the president of SK Communications, Yoo Hyun-oh, who owns it.”