"Bithumb Provides 11.6 Billion KRW Support for Current and Former Executives' Official Residences"

Bithumb has been revealed to have provided more than 10 billion KRW in rental deposits for company housing to four current and former executives without internal regulations or internal control procedures. Among them, a current executive directly approved the provision of rental deposits amounting to 3 billion KRW.

According to the Virtual Asset Supervision Department of the Financial Supervisory Service (FSS) on the 25th, Bithumb is suspected of providing high-priced company housing worth a total of 11.6 billion KRW to four current and former executives.

While operating the company housing rental system, Bithumb had no internal regulations or internal control procedures to prevent conflicts of interest, such as support limits, duration, or deposit recovery. In this situation, in June last year, current executive Mr. B personally decided to provide high-priced company housing (rental deposit of 3 billion KRW) for his own use, which posed a conflict of interest.

Additionally, Mr. C, a former executive and currently an advisor, disguised a personally purchased house as company housing rented by Bithumb. Bithumb paid a deposit of 1.1 billion KRW to Mr. C, who used it to pay the remaining balance on his personal purchase. Furthermore, Mr. C rented the house to a third party instead of providing it as company housing and received a deposit of 2.8 billion KRW. It was also found that two other former executives were supported with 1.8 billion KRW and 1.9 billion KRW respectively.

Mr. C served as CEO for several years after the company's establishment and, although not a registered executive currently, holds the title of president and serves as an advisor. He indirectly owns shares through the parent company. After the FSS inspection, Bithumb recovered the 1.1 billion KRW deposit and disciplined the related personnel.

Sehun Lee, Senior Deputy Governor of the FSS, explained, "Virtual asset operators are not yet incorporated into the financial sector, so they are not regulated by financial laws. However, since they are joint-stock companies, some level of internal control should be in place, but the inspection found that this part was operated very loosely." He added, "This was exploited for personal gain, contrary to the original purpose of the system."

The impact of this allegation on the renewal application of virtual asset operators is expected to be limited. Senior Deputy Governor Lee said, "This case can be seen as a personal deviation and is difficult to view as a systemic collapse at the company level. Since this was not specified as a violation or disqualification in the application or review requirements, it is unlikely to have an impact."