Korean authorities have issued an arrest warrant against the owner of the Bithumb cryptocurrency exchange, Kang Jong-Hyeon. Jong-Hyeon is reportedly wanted for money laundering and manipulating stock prices.
Kang is wanted alongside two top exchange employees for allegedly stealing customer deposits and manipulating stock prices. According to online reports, Kang and his executive colleagues violated the provisions of the Korean Capital Markets Act.
According to the allegations, the Bithumb CEO issued convertible bonds to manipulate the stock prices of Imbiogen and Bucket Studio, two businesses connected to Bithumb. The CEO of these two Bithumb-affiliated businesses, Kang Ji-Yeon, was recently in the news due to an affair with an actress.
With a 34.2% ownership interest, Vident is Bithumb Holdings’ largest stakeholder. Meanwhile, Imbiogen, a company with Bucket studio as its majority shareholder, is the largest stakeholder in Vident.
Anatoly Legkodymov, a Russian national and the founder of the cryptocurrency exchange Bitzlato based in Hong Kong, was also detained on related fraud and money laundering charges on January 19.
According to the US Department of Justice (DoJ), Legkodymov and other Bitzlato were arrested by US law enforcement agents over connections with an online black marketplace for drugs, Hydra.
The US DoJ also claims that Legkodymov used his crypto exchange to launder funds for criminals and other bad actors. If the allegations are confirmed, the Bitzlato founder could spend up to five years behind bars.
Meanwhile, US Attorney General Lisa Monaco commented that Legkodymov’s arrest proves that regulators worldwide cooperate to ensure that the crypto space is free from all bad actors. In a related development, reports claim that the leading crypto exchange Binance processed $346 million worth of transactions in the last five years for the Bitzlato exchange before its shutdown.
Besides Binance, Russia’s biggest financial pyramid scheme, Finiko, and P2P crypto exchange platform, LocalBitcoins were among Bitzlatzo’s top counterparties. Data from the on-chain analytics platform, Chainalysis states that Binance moved more than 20K BTC for the Hong Kong-based crypto exchange.
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