Earlier this year, Cyworld, a South Korean social media firm, launch its own cyrptocurrency token. The token called Clink had attracted many investors of buying it as Cyworld was one of the biggest social media platforms in the country.
However, Korea Times reported that the firm abruptly closed down its service at October 1st. The closure was without warning and it put the investors at the end of their nerves. Moreover, CoinZest and BitSonic, in which have the token on their listings are reportedly considering to remove support.
Launched in 1999, Cyworld was once the most used social network in South Korea. However, Facebook, Twitter and Instagram put it behind of the trend. In 2008, it had 18 million domestic users. But then it continued to decrease since. By 2014, it closed down its international services to focus instead on Korean market.
At January this year, the company enters the cryptocurrency market by conducting initial exchange offering (IEO). The company succeeded in raising around $400,000.
Cyworld to risk being sued by Clink token holders
Since the closure, Cyworld CEO Jeon Jae-wan has yet to comment on the Clink token’s future. With this going on, token holders are preparing to file a lawsuit to the company. The Times report predicted that Clink holders will lose more than KRW 1 billion if Cyworld doesn’t do anything soon.
According to South Korean regulations, article 119 and 335 of the Act on the Recovery and Bankruptcy of Debtors shall, in principle, give managers and bankruptcy officers the right to choose to implement or terminate contracts entered into by ICOs prior to the commencement of bankruptcy proceedings.
This means that managers and those appointed as bankruptcy inspectors can continue to fulfill the ICO company’s obligations to pay tokens. However, if you decide to terminate the contract, the token purchase agreement will be lifted and the buyer will have the right to return payment upon termination of the contract.
Meanwhile, GroundX, blockchain subsidiary of Kakao Corp. added more members on its Klaytn Governance Council. Kakao is currently the country’s biggest messenger platform provider.
