Former Bithumb Executive Arrested Under Embezzlement Allegations

  • The former chairman of crypto exchange Bithumb, Kang Jong-Hyun, was arrested in South Korea on charges of embezzlement, breach of trust, and market manipulation.
  • Seoul’s Southern District Court had issued an arrest warrant for Jong-Hyun and two other executives last week, one of which is the CEO of two Bithumb affiliates.


The former chairman of South Korean crypto exchange Bithumb, Kang Jong-Hyun, has been arrested on charges of embezzlement and market manipulation, local news outlet JTBC reported on 2 February.

The Seoul Southern District Court had issued an arrest warrant for Jong-Hyun and two other executives last week, accusing them of direlection of duty, market manipulation, and fraudulent transactions. One of the other executives was Jong-Hyun’s younger sister, Kang Ji-Yeon, who is the CEO of two publicly traded Bithumb affiliates, Inbiogen and Bucket Studio.

Prosecutors believe that the two siblings were involved in embezzlement of corporate funds, as well as manipulating the stock prices of Inbiogen — which holds the largest share in Vidente Vidente, the biggest shareholder of Bithumb — and Bucket Studio through the issuance of convertable bonds. Ji-Yeon has denied the allegations via a notice on Bucket Studio’s website, and stated that the siblings will cooperate with the authorities in their investigation.

The arrest of Kang Jong-Hyun, however, is unrelated to a separate probe launched by the South Korean National Tax Service last month, which is looking into a possible tax evasion at Bithumb and its affiliates. The Seoul offices of the crypto exchange were also raided last week as part of an investigation into price manipulation of a certain coin, though the asset was not named.

At the end of last year the largest shareholder of Bithumb, Park Mo, was found dead in front of his own home. It is suspected that the businessman took his own life as he was the target of an investigation for his alleged involvement in the embezzling of funds at Bithumb-related companies, as well as market manipulation.

Related Coverage
Mango Markets Exploiter Seeks to Keep $47M “Bug Bounty”
  • The person responsible for the Mango Market exploit, Avraham Eisenberg, has objected to Mango Labs’ lawsuit by claiming he had already settled with the DAO.
  • Mango Labs claimed last month that the settlement with the DAO was made “under duress”, and that he should return the $47 million “bug bounty”.
February 16, 2023, 2:51 PM


CFTC Files Market Manipulation Lawsuit Against Mango Markets Exploiter
  • The CFTC has filed a lawsuit against Avraham Eisenberg, and charged him with two counts of market manipulation for his involvement in the Mango Market exploit.
  • The individual had revealed himself as the exploiter on 15 October, claiming his actions were legal, and was later arrested by the DoJ on similar charges.
Sam Bankman-Fried Reportedly Under Investigation for Market Manipulation
  • U.S. prosecutors are reportedly investigating Sam Bankman-Fried’s involvement with the collapse of Terra, and if he had manipulated the prices of UST and LUNA at the time.
  • The New York Times pointed out that the majority of UST “sell” orders had come from Alameda Research, with sources claiming the company had placed bets on LUNA falling in price.