Bithumb Former Chairman Kang Jong-Hyun Arrested


Former chairman of crypto exchange Bithumb, Kang Jong-Hyun, was arrested on Thursday on suspicions of fraud and embezzlement, per CoinDesk Korea. 

Investigators allege that Kang along and at least two other executives were involved in stock price manipulation and theft during their time at the company. South Korean prosecutors are also probing Kang’s sibling, Kang Ji-Yeon. Ji Yeon reportedly serves as CEO of two Bithumb affiliates. 

The arrested capped a bewildering phase in Bithumbs history following the death of the company’s largest shareholder – Park Mo. Prosecutors disclosed that Mo was a suspect in the same stock price manipulation scandal that Kang was allegedly a part of. Shortly after the news broke, Korean news outlets reported that Mo committed “jasal” just outside his home. 

Turbulent Times At Bithumb 

Thursday’s arrest comes a week after prosecutors raided several local Bithumb offices. South Korean authorities said the event was tied to a coin price manipulation probe, and not directly linked with the crypto exchange itself.

Prosecutors seized transaction records connected to the coin during the raid but withheld the name of the asset for reasons unknown at press time. Authorities added that other crypto exchanges might experience similar raids as investigations proceed. 

Former Chairman Lee Jung-Hoon recently stood trial in a massive $100 million fraud case as South Korean authorities amped up efforts to enforce financial laws in the wake of Terra’s collapse. Lee was however acquitted of all charges in early January 2023. 

Tax Evasion Debacle

The National Tax Service Service has an open case against the crypto exchange. Per previous reports, the regulator believes Bithumb evaded taxes via dodgy domestic and international transactions. Several divisions of the crypto entity fall under the purview of the investigation, per reports. 

Back in 2018, the company was also accused of tax evasion but authorities dropped the charges due to insufficient findings. 

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