Owner of Bithumb is detained in South Korea on suspicion of embezzlement

The net is closing in on Bithumb executives as the suspected real owner of the exchange is arrested.

On February 2 local time, the claimed true owner of Bithumb, the largest cryptocurrency exchange in South Korea, was detained on suspicion of embezzlement.

Kang Jong-hyun was detained, according to allegations in the local media, on suspicion of embezzlement. On January 25, the businessman was given a warrant for arrest by the Seoul Southern District Court, which listed a number of offences against him, including neglect of duty, market manipulation, and fraudulent transactions.

The 41-year-old is Kang Ji-senior yeon’s brother and the CEO of Bithumb affiliate Inbiogen. The company owns the largest holding in Vidente Vidente, which, with a 34.2% stake, is the largest stakeholder in Bithumb.

Prosecutors claim that the brothers conspired to steal company funds and manipulate the stock prices of Inbiogen and the video production company Bucket Studio by issuing convertible bonds.

The CEO of Bucket Studio, Kang Ji-yeon, issued an apology to the company’s shareholders and claimed that the allegations against his brother were “unconfirmed,” adding that he would assist the authorities in their inquiry.

On January 10, we learned that the South Korean National Tax Service agency had started looking into the country’s biggest cryptocurrency exchange. According to reports, as part of the continuing tax investigation, investigators searched Bithumb’s headquarters in Seoul.

The story gets even more complicated because Park Mo, the largest shareholder in Bithumb, was discovered dead in front of his own house in late December.