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With the internet split on how Cobra Kai Season 6 added to Mr. Miyagi's back story, I'm here to say that I believe he did what he did to save someone from being prosecuted by the full extent of the law. I feel Miyagi might have taken the blame for the necklace being stolen to take the burden off someone more fragile.
It could also be that the writers behind Cobra Kai are adding to Mr Miyagi's character, and showing us that everyone has a past and that you can always change.
What do you think about this?