'Embezzlement Suspicion' Bithumb's Kang Jong-hyun Arrested... "Risk of Escape and Evidence Tampering"

[Asia Economy Reporter Hwang Seoyul] Kang Jonghyun, known as the actual owner of the cryptocurrency exchange 'Bithumb,' has been arrested.

On the 2nd, Kwon Giman, the warrant judge at the Seoul Southern District Court, held a pre-arrest detention hearing (warrant substantive examination) at 10:30 a.m. the previous day for Kang, who is accused of fraudulent unfair trading under the Capital Markets Act and embezzlement under the Act on the Aggravated Punishment of Specific Economic Crimes, and issued an arrest warrant citing "risk of flight and risk of evidence destruction." An arrest warrant was also issued for one of the two executives facing detention for the same reasons.

The arrest warrant for the other executive was dismissed on the grounds that there was "no risk of evidence destruction or flight."

Earlier, the Financial Investigation Division 2 of the Seoul Southern District Prosecutors' Office (Chief Prosecutor Chae Heeman) requested arrest warrants for Kang and two executives on the 25th of last month.

Appearing at the court at around 10:16 a.m. the previous day, Kang only said "I will cooperate sincerely" in response to reporters' questions about whether he admitted to embezzlement, then headed to the courtroom.

Kang Jonghyun is the older brother of Kang Jiyeon, CEO of Bithumb affiliates InvioGen and Bucket Studio. Although the CEOs of InvioGen and Bucket Studio are both listed as his younger sister Kang Jiyeon, suspicions arose that Kang Jonghyun is the actual owner, making him a key figure in the embezzlement case.

Vidente is a KOSDAQ-listed company and the single largest shareholder of Bithumb, holding 34.22% of Bithumb Holdings' shares. InvioGen is the largest shareholder of Vidente, and Bucket Studio is the largest shareholder of InvioGen.

The prosecution, having found evidence that the Kang siblings colluded to embezzle company funds or manipulate stock prices, conducted raids on Bithumb affiliates including Vidente, InvioGen, and Bucket Studio in October last year. Last month, Kang Jonghyun was summoned twice for investigation as a suspect on the 9th and 20th.