The former CEO of Bithumb, Lee Jeong-hoon is looking at a probable sentencing of 8-years behind bars. He is facing charges from regulators for attempting to divert regulations by redesigning the governance of the exchange platform in order to print gains from listed cryptocurrencies.
Bithumb is one of the biggest cryptocurrency trading platforms operating out of South Korea. There is a chance that he can get an 8-year sentence. The verdict on the lawsuit is set to be finalized in January next year.
Allegations Against Former Bithumb Head
South Korean media reports have unveiled that Lee has tried to redesign the governance of the trading platform to print gains from listed tokens on the exchange. The prosecutors have purported that the executive broke the law during this attempt.
At present, the trading platform is embroiled in a legal battle with a cosmetic surgery company.
The lawsuit started in October, 2018 on account of an acquisition dispute between Kim Byung-gun and BK Group. The lawsuit alleges a foul play of 100 billion won or $70 million in the acquisition contract.
South Korean Prosecutors Suggest 8-Year Imprisonment for Bithumb CEO
During the case proceedings, Prosecutors stated that Lee was aware of the trading constraints of BXA token. However, he refrained from disclosing the matter to Kim. At the same time, Lee received payments for not listing BXA token without disclosing the details to Kim.
On this account, the prosecutors from South Korea have suggested an 8-year sentence for Lee. On the other hand, Lee has presented a counter claim in the court and pointed out discrepancies in the claims brought by Kim.
At the same time, he has also raised questions regarding the reliability of Kim. He has also concerns about the competence of Kim to lead Bithumb and retained that he was informed about the progress of listing process for BXA token.
Lee is also facing legal charges concerning for breaching the Aggravated Punishment for Specified Economic Crimes Act and committing fraud. He has submitted an appeal in the court that could set the precedent for cryptocurrency trading platforms in the country.
Bithumb Prepares for a Public Listing on Kosdaq
At one end, the former executive of Bithumb is facing charges and on the other side, the trading platform is in the process of filing for a public listing. According to the company officials, the firm is planning to list shares on Kosdaq by 2025.
The outcome of this case can have a strong impact on the future of Bithumb exchange and BXA token. In case of a negative verdict, virtual currency trading platforms at large can face increased regulatory scrutiny.
Crypto investors in the region and account holders are waiting for the verdict on the appeal. At the same time, this case has gathered attention from investors to set a precedent for regulations regarding crypto businesses. At the same time, the case calls for specified regulations to address governance problems and retain investment safety.
Regulators in the United States have also brought charges against crypto firms in the region. In January this year, the SEC brought charges against Gemini and Genesis. Meanwhile, the attorney general of New York has also initiated lawsuits against DCG, Genesis, and Gemini.
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