South Korean Prosecutors Investigate Bithumb Over Fund Misuse Allegations

On March 20, 2025, official authorities carried out a raid at Yeoksam-dong headquarters. The investigation started when authorities received information about company money use to help former CEO Kim Dae-sik buy his own apartment.

South Korean prosecutors have reportedly launched an investigation into Bithumb, one of the nation’s largest cryptocurrency exchanges, following allegations of misused funds.

According to a report by Yonhap, on Monday, March 20, prosecutors from the Seoul Eastern Joint, Monetary, and Securities Detached Prosecutors’ Office arrived at the Yeoksam-dong headquarters of Bithumb to carry out an investigation.

The investigation apparently stems from an ongoing inquiry by the Financial Supervisory Service (FSS) into Bithumb. The FSS reportedly received an anonymous tip and began looking into the matter.

During their probe, the FSS uncovered an instance where Bithumb deposited money, said to be worth 3 billion won ($2.2 million), to help former CEO Kim Dae-sik buy his own apartment, according to local news outlet Korea JoongAng Daily.

The service then passed the case on to the prosecution for further action, the report notes.

The Seongsu-dong apartment that Kim allegedly had an interest in is located in a prime area of Seoul, and the money used for the deposit appears to have come from Bithumb’s own accounts.

While Kim is no longer the CEO, having transitioned to an advisory position at the organization, he was apparently still in control of Bithumb’s administrative and financial decisions during his time as CEO.

The authorities must now assess whether this transfer of funds ultimately broke any regulations at present.

Bithumb has yet to make any public statement regarding the various allegations.

Prosecutors will be reviewing financial documentation and interviewing company executives to determine if the company funds were unlawfully distributed.

If Bithumb and its executives are found guilty, they could face serious legal consequences. The case also highlights the growing concerns about sound financial practices within South Korea’s crypto market.

South Korea has been systematically reforming its cryptocurrency exchange regulations over the past couple of years. Regulatory bodies, such as the FSS and the Financial Services Commission, have been working to build trust in the market by trying to curb fraudulent activities and verify digital asset businesses' operations.

This case could increase the pressure on corporations to be governed better within this industry.

Earlier court actions against exchanges like Coinone and Upbit have already triggered intensified regulatory compliance requirements.

The outcome of the investigation is likely to influence the direction of upcoming regulatory policies in the country.

Moreover, a negative verdict for Bithumb might lead to less confidence from investors in the platform.

This case can also impact South Korea’s global standing as a player in the cryptocurrency market space.

Prosecutors will be collecting evidence and interviewing witnesses to make their decision on whether to press charges.

On the other hand, regulatory entities might introduce new measures to enhance their monitoring capabilities within the sector by the time this case period ends.