Report: Korean Police Seize Largest Local Crypto Exchange Bithumb
- The exchange reportedly pre-sold BXA tokens worth around $25 million without listing the token afterwards.
- The assets were issued concerning the acquisition of Bithumb by BK Group, which, after prolonged negotiations earlier this year, withdrew from the deal.
South Korean police vehicle, photographed on 14 February, 2009. Flickr/South Korea Police/Wikimedia Commons
On September 2, South Korea’s oldest newspaper, the Seoul Shinmun, reported that Bithumb’s offices had been raided for alleged economic fraud, involving the token known as BXA.
The exchange platform is reportedly accused of pre-selling native BXA coins worth about $25 million to investors without listing the token afterwards. The assets were supposedly issued concerning Bithumb’s acquisition by the Singapore-based BK Group, a deal that was never materialised.
Since earlier this year, the CEO of Singapore-based Blockchain Exchange Alliance (BXA), BK Kim, revealed plans to expand to the American and Japanese markets, BXA expressed their intention to acquire up to 70% of Bithumb operator BTC Holdings.
Last year, BK made a down payment of $100 million for the expected acquisition of Bithumb, but after prolonged negotiations, the alleged deal fell off. According to experts, this outcome resulted from a lack of funds from the BK Group, as earlier in July, Kosdaq-listed Dual industrial withdrew its offer of acquiring 57.41 percent of the company for 235.7 billion won ($200 million).
According to the Seoul Shinmun, Bithumb chairman Lee Jung Hoon is also under investigation on charges of escaping property. These allegations come after last week the Seoul Metropolitan Police Agency seized Coinbit, Korea’s third-largest cryptocurrency exchange, for allegedly inflating about 99% of its trading volumes and profiting around $84 million in the process.
Despite the allegations, Bithumb is supposedly planning to hold an initial public offering, as reported in June 2020.
- One of the largest South Korean commercial banks, KEB Hana Bank, partnered with crypto custodian BitGo in order to set up a new crypto custody venture in the country.
- The new venture, which will use BitGo’s crypto security expertise and Hana’s experience in financial services and compliance, is expected to launch in the second half of 2024.
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- The now arrested Terraform Labs CEO had reportedly converted the majority of his illicit funds into BTC using foreign exchanged not under the jurisdiction of South Korea.
- While none of the assets tied to Do Kwon were recoverable, South Korean authorities continue to seize assets and properties tied to other executives of Terra.
- A person suspected to be Terra founder Do Kwon was arrested at the airport in Montenegro’s capital city of Podgorica with “falsified documents”.
- South Korean authorities have confirmed the individual was Do Kwon based on “photo data”, name, age, and nationality, but are still waiting for fingerprint information.