The former chairman of the South Korean cryptocurrency exchange Bithumb, Lee Jeong-hoon, is accused of fraud, causing damages amounting to more than 110 billion won (more than $85 million), as well as deceiving an investor – the chairman of BK Group, Kim Byung-gun.
According to the investigation, Lee Jong Hoon proposed to the head of the cosmetics company BK Group to invest in a cryptocurrency exchange and then take part in the joint management of Bithumb. As financial security for future cooperation, Lee Jong Hoon guaranteed an additional issue and transfer to BK Group of tokens of the BXA Coin exchange in the equivalent of the investment amount.
The prosecution claims that Lee was aware of the problems with the listing of the BXA token, but deliberately hid this information from Kim. In addition, prosecutors are convinced that Lee’s plan to restructure Bithumb’s business was initially aimed at generating illegal profits.
The defense team disputes the allegations and argues that Lee fulfilled all obligations as a seller and also extended the payment period for tokens upon request. In their opinion, Kim unexpectedly decided to withdraw from the deal by filing a fraud lawsuit.
The Seoul High Court is expected to render a verdict in the Bithumb case on January 18, 2024. The court’s decision could lead to a re-evaluation of the governance structures of South Korean cryptocurrency exchanges, as well as change the policies and practices of crypto-asset exchanges.
Earlier, the Bithumb exchange notified the public of plans to enter KOSDAQ, the South Korean analogue of the Nasdaq stock exchange, in 2025, with an initial public offering of shares.
Source: Bits
I am an experienced journalist, writer, and editor with a passion for finance and business news. I have been working in the journalism field for over 6 years, covering a variety of topics from finance to technology. As an author at World Stock Market, I specialize in finance business-related topics.
