Supreme Court: "Bitcoin Also Constitutes Property Gain in Fraud"…Boscoin Executive's Suspended Sentence Confirmed

[Asia Economy Reporter Kim Hyung-min] The Supreme Court has, for the first time, recognized 'Bitcoin,' a type of virtual currency, as 'property benefits,' one of the essential elements for establishing the crime of fraud.

The Supreme Court's 3rd Division (Presiding Justice Kim Jae-hyung) announced on the 19th that it upheld the original ruling sentencing Park Mo, who was indicted for violating the Act on the Aggravated Punishment of Specific Economic Crimes (fraud), to 2 years and 6 months in prison with a 3-year probation.

Park is an executive of Boscoin, which held the first-ever Initial Coin Offering (ICO) in Korea, publicly recruiting Bitcoins from investors worldwide. Boscoin was established in 2015 by Park's father and two juniors, and Park has been working there since 2017.

In 2017, Park transferred 6,000 Bitcoins (approximately 19.7 billion KRW), which were kept in a joint account with his partners, to an account solely in his name under the pretext of an event participation and did not return them, leading to charges of fraud and extortion.

Specifically, in May 2017, Boscoin held Korea's first ICO, raising 6,902 Bitcoins from investors worldwide, which Park and his partners agreed to store in a multi-signature account. However, after the ICO ended, internal conflicts among executives arose, and Park's father, the largest shareholder and CEO, resigned.

Subsequently, Park, believing that his and his father's influence within the company was waning, decided to embezzle the raised Bitcoins and proposed to employees to hold a 'Boscoin Event.' This event promised to distribute a certain amount of Bitcoins proportional to the quantity owned by Bitcoin holders who could prove their ownership.

Park lied to the executives, saying, "However, this event is technically difficult to conduct with a multi-signature account. It is only possible with a single-signature account." Eventually, the executives moved 6,000 Bitcoins to Mr. A's single-signature account on the premise that they would be returned for the event, but Park did not return the Bitcoins.

The first trial court stated, "Park's crime is not minor," but judged that "he did not personally gain from the crime due to unfair treatment of his father," sentencing him to 2 years and 6 months in prison with a 3-year probation.

The second trial court and the panel found no problem with this judgment and confirmed it as is. In particular, they rebutted Park's claim that "the transfer of Bitcoins is merely a record or change of information and cannot be considered a transfer of property benefits, so fraud cannot be established."

The second trial court stated, "Since the parties to the transaction treat Bitcoin as having property value, it should be regarded as intangible property with economic value." The Supreme Court also reaffirmed the existing precedent that "Bitcoin is a type of virtual asset that digitally represents economic value and can be electronically transferred, stored, and traded," and judged that it "corresponds to property benefits, the object of the crime of fraud."

This content was produced with the assistance of AI translation services.