The prosecutor's office of the South Korean city of Seoul appealed to the court with a request to sentence the actual owner of the Bithumb cryptocurrency exchange to eight years in prison. He is accused of fraud in the amount of 100 billion Korean won ($69.45 million).
The relevant request was filed during the trial of the former chairman of the board of Directors of Bithumb Holdings and Korea, Mr. Lee, on charges of criminal activity in accordance with the Law on Strengthening Penalties for Specific Economic Crimes.
The prosecution explained that it demands an increase in the prison sentence, since the amount of damage is very large, and ordinary small investors have suffered. In October 2018, Lee proposed to BK Group chairman Kim Mo to acquire the Bithumb exchange. To do this, he issued Bithumb Coin (BXA) and placed this asset on the trading platform.
However, this token essentially had no actual value. As a result, Lee was accused of stealing funds received as a down payment. It turned out that Kim believed Lee's words and used part of the proceeds from the pre-sale of BXA as funds to buy his stake in Bithumb. However, BXA was not an officially registered asset.
Other victims investing in BXA sued Kim and Lee, but the investigative agency did not punish the former because he was also the victim of deception by Korean entrepreneur Lee.
The lawyer of the accused assured that his client was not guilty of anything and the structure of this case is a typical contract for the purchase and sale of shares. According to him, the negotiations were conducted with the participation of lawyers and professional companies, and no one had any questions before. He assured that the contract was executed in good faith, and Mr. Kim sued Lee to avoid criminal liability due to the victims of unsuccessful investments.