Bithumb Thailand sues Bithumb Korea over BXA fraud
Today Bithumb, South Korea’s largest cryptocurrency exchange by trading volume, saw an escalation in the serious legal challenges facing them. Bithumb Thailand Corporation sued employees and shareholders of Bithumb Korea and Bithumb Global Holdings for fraud. Additionally, the Seoul Metropolitan Police Agency subpoenaed Bithumb Korea’s Chairman Junghoon Lee for his involvement in the BXA fraud case.
Bithumb Thailand Corporation claims in their lawsuit that Bithumb Korea made fraudulent unfulfilled promises to open an exchange dedicated to the Thai market. The Thai company claims to have endured severe damages as a result of the alleged empty promises.
The suit also details Bithumb Korea’s use of Bithumb Thailand as a tool to gain more investments for BXA Token. BXA Token is the now defunct project that was once scheduled to be the native token used across all global Bithumb trading platforms. Investors surely saw the value in such a native token but were shocked and angered when the arrangement fell through at the very last minute.
Bithumb Partners
Bithumb Korea recruited partners to promote their global expansion in late 2017 through a Global Partners Recruitment Announcement. Shortly after the announcement, Bithumb launched Bithumb Thailand with the express intent of opening an exchange there.
Employees were hired and media reports circulated about the impending exchange launch. The exchange did not launch, however, and employees claim that Bithumb Korea merely created the buzz in order to promote the BXA token sale.
The news of Bithumb Thailand and various other international exchanges opening would increase the reach of the exchange, thereby increasing the value the native platform token. In other words, more platforms leads to more users. Bithumb Korea may have widely overstepped its bounds in regard to Bithumb Thailand since they did not launch the exchange but allegedly used the exchange fraudulently attract more investors.
Bithumb Thailand’s attorney Ohoon Kwon from Cha & Kwon Law Firm in South Korea, is handling the cases of all affected BXA token investor complaints. Kwon commented that Bithumb affiliates in Hong Kong and Vietnam were victimized in a similar way as Bithumb Thailand.
Director Junghoon Lee summoned
Today the Seoul Metropolitan Police were busy tracking down Junghoon Lee, the chairman of Bithumb Korea. Lee also currently owns the majority of shares in Bithumb.
The subpoena and summons to appear comes mere days after police raided Bithumb HQ for the second time in as many weeks. Police directly referenced the BXA fraud case in regard to the reason for the second search and seizure.
The first search happened about two weeks ago and represented another domino falling against the accused Jonghoon Lee and Byunggoon Kim. Both men were required to appear in South Korea to be available to law enforcement and courts.
The men allegedly orchestrated a fraud scheme wherein they promised investors of BXA tremendous returns on a BXA token launch which never happened. In recent months, the scheme’s depth and scope has come increasingly into the public view.
The issue threatens to scar the entire South Korean cryptocurrency industry which just earlier this year earned legal recognition and regulations worthy of a maturing market.
