Lee Jeong-hoon, the former chairman of major cryptocurrency exchange Bithumb, confronts serious fraud charges. Prosecutors have requested an eight-year prison term for Lee, accusing him of orchestrating a 110 billion won fraud involving Kim Byung-geon, the chairman of BK Group. The allegations focus on a controversial deal where Lee offered Kim co-management of Bithumb and the listing of BXA (Bithumb Coin) on the exchange.
Lee’s indictment centers on accusations of violating the Act on Aggravated Punishment for Specified Economic Crimes. Prosecutors allege that he aimed to restructure Bithumb’s governance to benefit from exchange coins, evading financial regulations. They argue that despite knowing the challenges in listing BXA Coin, Lee continued to accept payments without informing Kim about the decision not to list the coin.
However, Lee’s defense highlights inconsistencies in Kim’s statements, questioning his credibility and asserting that Kim was informed about the BXA Coin’s listing progress.
The outcome of this appeal, slated for January 18, 2024, holds significant weight for South Korea’s cryptocurrency industry. A guilty verdict could trigger reevaluating governance structures in crypto exchanges, leading to more stringent regulatory measures.
This case emerges as Bithumb prepares for a potential IPO on KOSDAQ by 2025. The verdict will decide Lee’s fate and shape the future regulatory landscape for cryptocurrency exchanges in South Korea, impacting investor confidence and governance practices industry-wide.
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