Crypto Exchange Bithumb Owner’s Arrest Requested by South Korean Prosecutors

South Korean prosecutors are seeking the arrest of Kang Jong-Hyun, the chairman and owner of cryptocurrency exchange Bithumb, a Korean news outlet reported on Wednesday.

Kang and two other executives – including his younger sister, Kang Ji-Yeon, the CEO of two publicly traded Bithumb affiliates, Inbiogen and Bucket Studio – were charged by the Seoul Southern District Prosecutor’s Office with embezzlement, breach of trust and fraudulent illegal transactions, according to local reports.

Earlier this month, it was reported that South Korea’s National Tax Service had opened an 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.

Kang and his sister are not the first Bithumb executives to find themselves in hot water for alleged wrongdoing connected to one of Korea’s five remaining exchanges. 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 is one of five remaining Korean crypto exchanges following a crackdown on the industry in 2021 when approximately 70 domestic exchanges closed after failing to meet regulatory requirements.