According to local media reports, the owner of South Korea’s largest cryptocurrency exchange, Bithumb, was arrested in the country on Thursday on charges of fraud and stock manipulation.
Kang Jong-hyun, the de facto owner of local crypto exchange Bithumb, has been arrested, prosecutors said.
Kang was issued an arrest warrant by the Seoul Southern District Court on January 25 on several charges, including neglect of duty, market manipulation, and fraudulent transactions.
Kang Jong-hyun enters the Seoul Southern District Court on Feb. 1, 2023, to attend a hearing to determine his arrest. Image: Yonhap News Agency.
Brother And Sister Involved In Misappropriation Of Funds?
According to prosecutors, he manipulated stock prices and stole about $50 million. Yonhap News Agency reported that Kang’s brother and sister planned to embezzle company funds and manipulate stock prices.
The company’s headquarters were raided by the Intelligence Crime Investigation Unit of the Seoul Metropolitan Police Agency for selling $25 million worth of tokens offered on the exchange and the BTHMB deal.
After the attack, the authorities issued an arrest warrant against Kang to prevent him from leaving the country.
Authorities also arrested and detained Jo Mo, a member of Kang’s inner circle and Bithumb spokesperson.
Image: CCN
Bithumb Owner’s Romance with an Actress
Kang recently rose to fame after his relationship with Korean actress Park Min-young.
Park admits that Kang, with whom she has been linked, is her boyfriend, but she states that their romance is now over.
Park released an official statement through her agency confirming her relationship with Kang. He denied accepting money from the wealthy businessman.
Kang is the brother of Kang Ji-yeon, the top executive of Inbiogen, a subsidiary of Bithumb. The company owns the majority of Vidente, Bithumb’s largest shareholder with 34.2% ownership.
Kang has denied claims of stock manipulation and embezzlement, insisting that he has no relationship with the company because he no longer owns the stock.
Ji-yeon, for her part, stated that the accusations against her brother were “unconfirmed.”
SBF Has Interest In South Korean Crypto Exchange
It was reported earlier this month that South Korea’s National Tax Service has begun an investigation into alleged tax evasion by Bithumb and its partners.
Bithumb is one of five Korean cryptocurrency exchanges left after the clampdown on the sector in 2021, when about 70 local digital currency exchanges were closed for not meeting regulatory standards.
Sam Bankman-Fried, the founder and former CEO of FTX, is reportedly planning to propose a buyout of cryptocurrency exchanges at some point when he acquires crypto companies around the world. No agreement was expressed.
Law enforcement has been investigating Bithumb for most of 2022, with the latest development being the acquittal of its previous chairman on fraud charges.
South Korea has always been one of the most active investment and trading places for cryptocurrencies.
Authorities have been wary of regulating the digital asset class because of the perception that regulating cryptocurrencies would legitimize the industry.
Featured images from Freepik