Bithumb Owner Charged with Embezzlement, Breach of Trust

• Kang Jong-Hyeon, the owner of Bithumb, South Korea’s largest crypto exchange, has been charged with embezzlement and breach of trust.
• Two of Bithumb’s affiliate companies, Inbiogen and Bucket Studio, have been implicated in the case, with Kang’s younger brother, Kang Ji-Yeon, suspected to be involved in the process of manipulating stock prices.
• Vidente, Bithumb’s largest shareholder, is also linked to the case, with investigations initiated against the affiliate in October 2022.

Kang Jong-Hyeon, the owner of Bithumb, South Korea’s largest crypto exchange, has been charged with embezzlement and breach of trust, prompting a warrant for his arrest. The Seoul Southern District Prosecutor’s Office Financial Investigation Division has alleged that Kang was involved in the manipulation of stock prices of several companies affiliated with Bithumb. Two of these affiliate companies, Inbiogen and Bucket Studio, have been implicated in the case, with Kang’s younger brother, Kang Ji-Yeon, suspected to be involved in the process of manipulating stock prices through the issuance of convertible bonds.

Vidente, Bithumb’s largest shareholder, has also been linked to the case as investigations have been initiated against the affiliate in October 2022. Vidente holds a 34.2% stake in Bithumb, and is the largest shareholder. Additionally, Vidente’s largest shareholder is Inbiogen, and Inbiogen’s largest shareholder is Bucket Studio, thus making all the companies intertwined. Unfortunately, during the investigation, the Vice President of Vidente committed suicide.

The investigation is ongoing, and the charges against Kang and the other executives of Bithumb affiliates fall under the Act on the Aggravated Punishment of Specific Economic Crimes and fraudulent illegal transactions under the Capital Markets Act. If found guilty, Kang and the other accused could face up to 10 years in prison and fines of up to 50 million won (approximately $45,000).