Former Chairman of South Korean Crypto Exchange Bithumb Arrested: Report
Kang Jong-Hyun, the former chairman at South Korean crypto exchange Bithumb has been arrested on charges of embezzlement, breach of trust and fraudulent illegal transactions, CoinDesk Korea reported on Thursday.
South Korean prosecutors had sought the arrest of Jong-Hyun last week along with two other executives – including his younger sister, Kang Ji-Yeon, the CEO of two publicly traded Bithumb affiliates, Inbiogen and Bucket Studio, according to local reports.
Subsequently, on Thursday last week, the offices of Bithumb were raided as part of an investigation into price manipulation of a coin listed on the South Korean crypto exchange, Yonhap reported. The coin involved wasn't identified.
South Korea’s National Tax Service had reportedly opened a separate investigation into possible tax evasion at Bithumb and its affiliates.
The investigation into Kang and the other executives’ behavior is separate from the tax evasion investigation, and centers around allegations that Kang and the others stole company money and conspired to manipulate stock prices.
Bithumb is one of only five Korean crypto exchanges following a 2021 crackdown in which approximately 70 domestic exchanges closed after failing to meet regulatory requirements.
The past few months have been murky for Bithumb. On Jan. 3, former Bithumb Chairman Lee Jung-Hoon was acquitted on charges that he committed a $100 million fraud connected to the exchange.
In December, Bithumb’s largest shareholder, Park Mo, was reportedly found dead outside his home in South Korea after being named as a suspect in prosecutors’ investigation into the alleged embezzlement and stock manipulation. Local media reported that he took his own life.
Bithumb did not immediately respond to CoinDesk's request for further comment.
Kang Jong-hyun or his lawyers could not be reached for comment.