• South Korean crypto exchange Bithumb is under investigation for a suspected bribery case involving an employee.
• The alleged bribery was in exchange for facilitating a coin listing on the platform.
• Industry insiders claim that these rumors of exchanges receiving money to list coins have been circulating for some time.
Bithumb Exec Suspected of Taking Bribe
An official from South Korean crypto exchange Bithumb is under investigation on suspicion of taking bribes in exchange for facilitating a coin listing. Per Chosun Ilbo, the allegations surround an individual surnamed Lee who was described as „an employee of Bithumb Holdings,“ the „Bithumb parent company.“ The Seoul Southern District Prosecutor’s Office’s Financial Investigation Division is conducting the investigation and have searched both the offices of Bithumb Holdings and Lee’s home.
Coinone Official Also Under Investigation
The allegations come as a second major blow to the South Korean crypto exchange industry in two months, with former Coinone official surnamed Jeon also placed under investigation by the Seoul Southern District Prosecutor’s Office. Prosecutors believe Jeon may have received hundreds of thousands USD in return for listing several coins on the Coinone platform.
Rumors of Exchanges Receiving Money to List Coins
An unnamed domestic crypto industry insider told Chosun that rumors that exchanges receive money to list coins have been around for a long time. However legal experts stated that courts do not currently have the power to hand out heavy punishments in such cases, thus calling for legislative reform. Other insiders claimed that exchanges had been allowed to wield too much power – by determining which coins they list by themselves without any regulatory body intervening in their decisions.
Formation of DEXA Following Terra Ecosystem Crash
In response to the Terra ecosystem crash last year, Korea’s biggest exchanges co-formed DEXA, a self-regulatory organization committed to upholding ethical standards among domestic trading platforms and protecting investors‘ interests through transparency and compliance with laws and regulations. This has led many hoping that this would bring more order into Korea’s cryptocurrency sector.
Call For Legislative Reform
Despite efforts made by self-regulatory organizations like DEXA, legal experts are still calling for legislative reform as courts do not currently have enough power to impose heavy punishments when it comes to these types of cases involving briberies and manipulation tools used by small-cap coins being listed on major exchanges without approval from regulatory bodies