South Korea’s Financial Intelligence Unit (FIU), part of the Financial Services Commission (FSC), uncovered a staggering 500,000 to 600,000 suspected violations of Know Your Customer (KYC) requirements at Upbit, the country’s largest cryptocurrency exchange.

The discovery comes during a meticulous review of Upbit’s business license renewal application, raising concerns about potential legal and regulatory ramifications.

Potential KYC Violations on Upbit

Local media reported that according to sources within South Korea’s financial sector, the FIU’s findings were the result of an intensive inspection that began in late August. The violations pertain to lapses in Upbit’s customer verification processes, a crucial component of anti-money laundering (AML) and counter-terrorist financing (CTF) measures.

Examples of breaches include accounts being approved despite incomplete or blurred identification documents. According to the financial regulator, this could facilitate illicit activities such as money laundering.

An official from Upbit reportedly refrained from commenting on the FIU’s ongoing review, citing confidentiality clauses. However, the exchange’s operational future hangs in the balance as financial authorities verify the validity of the flagged cases. Potential fines of up to 100 million won (approximately $75,000) per violation loom.

This is not the first time Upbit has been scrutinized. South Korean authorities have consistently monitored the exchange due to its dominant position in the local crypto market. Of note is that it is the largest trading volume in the South Asian region.

As BeInCrypto reported, South Korean lawmakers recently opened an investigation against Upbit. The probe centered on the monopoly structure of the virtual asset market built around the trading platform. Similarly, listings on Upbit have been known to cause significant market fluctuations, leading to questions about transparency and fair practices.

Upbit Listings Remain Controversial

Recently, Upbit’s move to expand the Uniswap (UNI) trading pair caused a 150% volume spike for the decentralized exchange token. Similarly, the exchange’s popularity boosted Cat in a Dogs World (MEW) to a new peak, also following trading pair expansion. Other tokens that have benefited from trading activities on Upbit include Injective (INJ) and real-world asset (RWA) token Ondo Finance (ONDO).

Nevertheless, it is impossible to ignore the prevalence of South Korean traders engaging in “pump and dump” schemes, particularly for altcoins. As noted by CryptoQuant CEO Ki Yong Ju, some traders exploit Upbit’s listings to artificially inflate token prices before selling them off, leaving other investors at a loss.

“Korean crypto traders love pumping & dumping altcoins, ironically,” Young Ju noted, demonstrating with a video.

In addition, traders tend to exploit the Kimchi premium, a price gap between South Korean and overseas exchanges. While these practices are not directly linked to Upbit’s management, the exchange’s listings wield an undeniable influence on the market.

Meanwhile, even in the face of ongoing regulatory challenges, Upbit has recently taken steps to enhance transparency and user protection. In July, the exchange issued its first public disclosure under the newly enacted Virtual Asset User Protection Act. This testified to Upbit’s financial stability, user asset holdings, and risk management practices, reflecting an effort to align with changing regulatory standards.

Additionally, Upbit has made strides in global compliance. In January, it secured a Digital Payment Token Services License from Singapore’s Monetary Authority of Singapore (MAS). This milestone followed an earlier conditional approval from the same regulator. The license reflects Upbit’s commitment to regulatory adherence in international markets, even as it faces scrutiny at home.

Notwithstanding, the FIU’s findings could have far-reaching implications for Upbit, both domestically and internationally. While the financial watchdog has yet to announce definitive conclusions, the scale of potential violations could result in hefty fines.

Furthermore, besides reputation damage, the case may prompt broader discussions about KYC practices and regulatory compliance across South Korea’s growing crypto sector. Upbit’s influence as a market leader makes its actions particularly significant. Beyond dominating South Korea’s trading volume, Upbit also shapes trends and token adoption rates.

YouTube investigative journalist Coffeezilla, known for his deep dives into influencer-driven scams and questionable financial schemes, released a detailed video examining MrBeast’s alleged involvement in cryptocurrency ventures.

In the exposé, Coffeezilla scrutinizes MrBeast’s financial gains from crypto investments. He confronts serious accusations of insider trading and exploitation of his public platform for profit. However, MrBeast’s team reportedly declined to provide detailed comments, instead issuing a carefully worded legal statement.

Coffeezilla Investigation on MrBeast’s Potential Scams

According to Coffeezilla, this complex story blurs the line between “shady” and outright “illegal.” The investigation was prompted by allegations circulating online.

Some claim MrBeast profited as much as $23 million through manipulative and deceptive practices. Coffeezilla, known for his thorough research and impartiality, reached out to various sources—researchers, crypto project heads, and even MrBeast himself.

According to Coffeezilla, the accusations stem from two main sources. The first is a report by SomaXBT, which alleges MrBeast made $10 million by backing low-cap cryptocurrency tokens, which later plunged in value.

“An investigation into Mr. Beast, how he allegedly made $10 million+ by backing low-cap IDO crypto tokens promoted by influencers like Lark Davis, CryptoBanter, KSI, and others. Many of these projects are now down over 90%, with some rebranding after major losses,” SomaXBT shared on X (formerly Twitter).

Another group, look.io, claimed he made even more through “scams, shady deals, and his network of connections.” Coffeezilla asserts that while some allegations seem exaggerated, there is credible evidence supporting others, making it difficult to offer a single, definitive judgment.

Key Allegations: Inside Deals and Suspicious Tweets

Coffeezilla begins by dissecting a few specific cases involving cryptocurrency projects in which MrBeast allegedly participated, including Super and Earnity Chain. According to the report, MrBeast invested in these projects, later promoting them publicly while secretly selling off his shares. This led some to believe he was engaging in unethical, if not illegal, market manipulation.

For instance, Coffeezilla discusses leaked screenshots showing MrBeast’s alleged involvement in Super’s pre-sale. According to these images, MrBeast invested $100,000, ultimately cashing out over $10 million. Coffeezilla points out that MrBeast tweeted twice about Super, one of which came suspiciously close to a sale of tokens by a wallet linked to him.

In another tweet, he hinted at the project’s value, saying “super” in response to a comment about the token’s potential growth. Coffeezilla suggests this could have influenced MrBeast’s followers to buy in while he was secretly offloading his investment, a potential conflict of interest.

According to Coffeezilla, this pattern is repeated in the cryptocurrency Earnity Chain. MrBeast’s name was prominently featured on the Earnity Chain website. He even allegedly promoted an associated NFT (non-fungible token) charity auction meant to benefit his “Team Seas” initiative.

Yet, records show his alleged wallet sold millions of Earnity tokens during the auction’s two-month campaign. Coffeezilla acknowledges that the charity auction itself performed poorly. Nevertheless, the investigator criticizes the timing, labeling it a “terrible look” for MrBeast, known as the “charity guy.”

A Complicated Network of Influences and Power Players

According to Coffeezilla, one of the most complex elements of the story is MrBeast’s involvement in crypto beyond his direct actions. The detective uncovers links between MrBeast’s investments and Jason Williams, a figure in the cryptocurrency space who appears to have managed some of these funds.

Coffeezilla found that Williams was connected to the same wallet linked to MrBeast’s investments. Reportedly, he often promoted and sold tokens associated with MrBeast’s name. This association could potentially absolve MrBeast of some responsibility, but as Coffeezilla points out, the boundaries remain unclear.

Of note is that MrBeast has occasionally spoken publicly about his investments, including a now-infamous conversation with Logan Paul, where he discussed purchasing CryptoPunks after a call with influencer Gary Vee.

“So, it seems like MrBeast was very much aware of, and in some cases directly involved in, decisions to buy and sell crypto,” Coffeezilla concludes.

While MrBeast’s team denies he was directly involved in trading, Coffeezilla finds it hard to believe MrBeast was entirely hands-off.

MrBeast’s Team’s Response (Or Lack Thereof)

In response to these allegations, MrBeast’s team provided a statement. In it, they assert that his investments were managed through a fund that consulted with industry experts and adhered to all “appropriate regulations.”

According to the team, MrBeast did not control the day-to-day trades. Yet, as Coffeezilla observes, the statement “takes zero accountability” and fails to address specific claims about MrBeast’s tweets and sales.

Critics say MrBeast’s brand is being used as a marketing tool in cryptocurrency projects, leading to inflated values that hurt regular investors. This becomes especially problematic given MrBeast’s vast following and reputation as a philanthropist.

For Coffeezilla, the issue is not merely about legality; it is about ethics. He suggests that while MrBeast’s actions may not be criminal, they still raise questions about his responsibility to his audience.

“I think to MrBeast and probably to his fund, this is just business. They set out to make a lot of money, and they made a lot of money—what’s the problem, right?” Coffeezilla quipped.

Indeed, Coffeezilla’s exposé is a compelling, if unsettling, reminder of the blurred lines between fame, finance, and influence within the crypto playing field.

Elon Musk named Microsoft and other defendants in his ongoing lawsuit against OpenAI. In court documents, Musk claimed that OpenAI sought to launch a cryptocurrency in 2018, which he rejected.

OpenAI representatives posted years-old correspondence with Musk, citing his full knowledge of their struggle to fund massively capital-intensive research.

Elon Musk vs OpenAI

In the latest court filing, Elon Musk named several new defendants in his ongoing suit against the prominent artificial intelligence firm OpenAI. Musk names former OpenAI associates and investors in this amended complaint, including Microsoft. He accused the company of abandoning its nonprofit focus, which was a major reason behind Musk’s initial investment.

Since OpenAI abandoned its nonprofit status, the firm has publicly sought to reach a valuation of $150 billion. This would be a staggering net worth for any company, even one that aims to reform the whole tech industry.

Also, according to court documents provided by Musk’s legal team, OpenAI first tried to launch an ICO in 2018:

“In January 2018, mere months after their September 2017 ‘enthusiasm,’ Altman proposed a scamworthy ‘ICO,’ or initial coin offering, that would have seen OpenAI, Inc. sell its own cryptocurrency. Musk shot down this idea too, stating ‘it would simply result in a massive loss of credibility for OpenAI and everyone associated with the ICO,’” Musk’s team claimed.

In other words, Musk’s lawyers are claiming that OpenAI founder Sam Altman has always prioritized making money over the public good. Musk claims he only joined the project to run it as a nonprofit and then left over this philosophical difference. The company has generated huge revenues since going public, receiving $6.6 billion in funding this October.

However, the firm strongly disputed these allegations. This March, the firm published prior correspondence between Musk and company executives, stretching back nearly nine years.

In these talks, OpenAI members stressed the capital-intensive nature of AI development and stated that a profit-seeking pivot would be “inevitable.” In other words, Musk had known of this for years.

“We’re sad that it’s come to this with someone whom we’ve deeply admired—someone who inspired us to aim higher, then told us we would fail, started a competitor, and then sued us when we started making meaningful progress towards OpenAI’s mission without him,” the company’s statement read.

As of yet, the lawsuit’s prospects of success seem very unclear. Musk previously dropped this lawsuit in July, before opening it again and naming new plaintiffs. This attack may be an attempt to cause a headache for OpenAI, rather than win a large settlement or substantially change the company’s business trajectory.