South Korean authorities are cracking down on a controversial crypto project. Seoul Metropolitan Police launched a surprise raid on the offices of Winnerz, a sports-themed blockchain platform, amidst accusations of operating a "scam coin."

The investigation centers around Winnerz's native token, WNZ, and its alleged involvement in a multi-level marketing scheme. This probe follows a bombshell February post by a group of anonymous investors, who publicly accused Winnerz of running a fraudulent operation.

The raid, conducted on April 1st, targeted two locations: the Winnerz office in Gangnam, Seoul, and the residence of former CEO Choi Seung-jeong. Police secured evidence using a court warrant, citing potential violations of the Act on Aggravated Punishment for Specific Economic Crimes, which covers fraud and coercion.

The scandal has tarnished the reputations of several high-profile figures in South Korea. In the wake of the accusations, numerous celebrities, sports stars, and social media influencers rushed to distance themselves from both Choi and Winnerz.

This isn't the first time South Korea has grappled with a suspected crypto scam. The investigation into WNZ appears to be linked to another controversial token, Golden Goal (GDG). Authorities suspect GDG might be a multi-billion-won crypto fraud, and its former CEO, surnamed Kim, was arrested in late March.

Reports indicate that Choi may have previously promoted GDG, further fueling speculation about a potential connection. The Winnerz case adds to a growing list of crypto-related controversies in South Korea, prompting the Financial Services Commission (FSC) to step in. The regulatory body received complaints from investors regarding WNZ and forwarded the case to the police for investigation.

News of the raid appears to have impacted WNZ's value, with reports suggesting a significant drop in price. As the investigation unfolds, the Seoul Southern District Prosecutors' Office's Virtual Asset Joint Investigation Unit – the nation's top anti-crypto crime force – is taking the lead in scrutinizing Choi's activities. With the spotlight firmly on Winnerz, only time will tell if the allegations of "scam coin" operations hold weight.