Tag Archive : Bithumb

Seoul Police Seized South Korean's Crypto Exchange Bithumb for Third Time

Seoul Police Seized South Korean’s Crypto Exchange Bithumb for Third Time

Bithumb, the largest cryptocurrency exchange in South Korea, was reportedly raided for the third time, by Seoul Metropolitan Police Agency’s Intelligent Crime Investigation Unit.

Police reportedly seized a number of shares in Bithumb Holdings. Despite this, the holdings belongs to Bithumb Korea Director Kim Byung-Geon. In contrast, the seizure action granted by the Seoul Central District Court on September 14.

Hence, the investigation was after it allegedly sold its native BXA tokens for over 30 billion won ($25 million). Although, the sale is based on a former takeover deal with the Bithumb Korea Group. 

As per the Blockchain Transparency Institute (BTI) report, Bithumb was ranked fourth in the world. Furthermore, second in Korea based on the daily trade volume. According to Coingecko, the exchange supports 108 cryptocurrencies and 109 trading pairs. Despite, with a 24-hour trading volume of $235 million, at the time of writing.

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Exchange Ranking By 24-hours Volume (Source: BTI)

At the beginning of September, the trading volume of Bithumb was over 600 million. Currently, the trading volume reduced to 250 million.

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Bithumb Trading Volume 14-Days (Source: Coingecko)

The exchange’s initial raid happened on September 2, and the second raid on September 7. Samjong KPMG, beginning of this month completed a letter of intent (LOI). By the way, explaining that it planned to sell its own stake in Bithumb Holdings.

Likewise, last month South Korean cryptocurrency exchange Coinbit was seized by police. For allegedly making false transactions to obtain 100 billion won ($84m). 

Seoul Police Seized South Korean’s Crypto Exchange Bithumb for Second Time

Seoul Metropolitan Police Agency’s Intelligent Crime Investigation Unit raided Bithumb for the second time in connection to the BXA token fraud allegations against its Chairman.

Bithumb is the largest crypto asset exchange in South Korea. It has over 8 million registered users. One million mobile app users and the current overall volume has exceeded $1 trillion.

According to the local Seoul Shinman publication, the Seoul Police entered Bithumb’s headquarters and seized evidence relating to a $25 million fraud investigation linked to the sale of BXA token.

The investors in these tokens faced losses as the exchange did not list them on its platform for trading. In this raid authorities target the offices relating to Bithumb Holdings, the parent company of Bithumb Korea, which operates the crypto exchange platform.

Bithumb’s Chairman Lee Jung-hoon, accused of illicitly moving funds overseas. The first raid happened last week for the same case. 

Despite the investigations, South Korea’s largest exchange keeps holding its position on the market. It has also got global reach and impressive influence in the crypto space.

Bithumb has recently launched its smart token BTCS, along with ETHS, XRPS, LTCS, BCHS, BSVS, and COMPS.

As per tokenmarketcap data, the crypto exchange is still the ninth-largest crypto exchange worldwide. The reported daily trading volume accounts for about $250 million at the time of publishing, down around 16.58 % over the past 24 hours.

Seoul Police Seized South Korean’s Largest Crypto Exchange Bithumb

Bithumb, the largest cryptocurrency exchange in South Korea. It reportedly raided by Seoul Metropolitan Police Agency’s Intelligent Crime Investigation Unit, for a $25 million token sale on its platform.

As per the report, the raid was connected to the Chairman of the Board at Bithumb Korea and Bithumb Holdings Lee Jung Hoon. Loon accused of fraud and illicitly sending funds overseas.

Bithumb reported conducting the token sale for BXA. The token reportedly promoted as the Bithumb’s native token which involved large range fraud causing the investors with the damage of 30 billion won ($25 million).

Over 300 participants joined in the token sale lost millions.

Bithumb transaction fee costs around 30% of the transaction amount. However, users reached the exchange’s customer support to clarify the high transaction fees.

Bithumb customer support replied stating,

“The Ethereum network is currently congested, which will result in very high fees. You can withdraw by onmi or trc 20”

Screenshot of Bithumb Customer’s Transaction Fees

Moreover, Bithumb is the ninth-largest crypto exchange by average daily trading volume globally. As per Tokenmarketcap, the exchange has a 24h trading volume that stood at over $365 million.

South Korean crypto exchange Coinbit also seized by police last week for making a false transaction to obtain 100 billion won (84 million). While South Korea continues to break crypto laws, there is a chance of more attacks like these could follow.

South Korean Crypto Exchange Coinbit Seized for $84 M in Wash Trade Allegations

South Korea cryptocurrency exchange Coinbit seized by police for allegedly making false transactions to obtain 100 billion won ($84m).

As per the report from Seoul Shinmun, South Korea’s oldest newspaper, police accused Coinbit Owner Choi Mo and other managers for handling multiple accounts, controlling cryptocurrency prices, and raising transaction volume. 

Authorities disclosed that the exchange has divided into two functional accounts. The first account consists of major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and Tether (USDT). Here using ghost accounts the trading was done to inflate the trading volumes.

The second account contains only smaller crypto and altcoins, wherein crypto transactions with other exchanges were stopped, enabling Choi and his team to control the supply. With this strategy, they were able to directly analyze the market margin by trading large amounts of coins at certain times.

The report findings were withheld to the public until the police completed their investigation. As of press time, Coinbit declined by -2.16% (7d) in terms of trading volume. 

A wash trade is generally a form of market manipulation in which an investor simultaneously sells and buys the same asset to create misleading and artificial activity in the marketplace deemed illegal in most jurisdictions.

Coinbit only had 252,000 visitors within the last three months, being overtaken by Bithumb and Upbit. The number of affected customers by the incident were still unknown at this time. As South Korea continues to draft crypto laws, there is concern that more attacks like these could follow.

Likewise, the executives of UPbit, also one of South Korea’s largest cryptocurrency exchanges, have made fraudulent transactions using a fake corporate account to make fake orders worth 254 trillion won ($226.2 billion) to inflate trading volume back in December 2018.