South Korea has ordered one of the country’s largest Bitcoin exchanges to pay compensation. A local court ruling obliges the exchange to pay around $200,000 to its 132 investors.
South Korean court orders this Bitcoin exchange to pay compensation
Bithumb, one of the popular crypto exchanges, is preparing to pay just over $200,000 in compensation. On January 13, South Korea’s Supreme Court finalized its decision that the exchange must compensate investors for the 1.5-hour service interruption on November 12, 2017. According to a local news source, the losses are equivalent to $202,400. By the way, the court initially ruled against the investors, but later this decision was reversed. The final decision of the Supreme Court ordered the 132 investors to be paid damages ranging from $ 6 to about $ 6,400. The final decision of the court stated:
The burden or cost of technological failures should be borne by the service operator, not the service users paying commissions for the service.
Bithumb is South Korea’s largest cryptocurrency exchange. The temporary outage came after the average order quantity per hour suddenly doubled and transaction flows were clogged. Investors seeking compensation suffered massive losses in Bitcoin Cash and Ethereum Classic positions during the outage.
Bithumb was strictly monitored by local authorities
The stock market has been under the spotlight for a while. Bithumb’s ex-president is now being more tightly investigated by regulators, amid investigations and the sudden death of one of its largest shareholders following allegations of embezzlement.
The investigation is a “special tax investigation” conducted by the country’s National Tax Service (NTS). Authorities are investigating tax evasion possibilities and raided Bithumb’s headquarters on January 10. Regulators in South Korea seem to be putting pressure on the local crypto scene. In November 2022, the country launched investigations on cryptocurrency exchanges to list native tokens.
After the FTX scandal, the South Korean city of Busan announced that it is removing global crypto exchanges from its plans to join third-party digital exchanges. The city of Busan has thus moved one step closer to creating a local crypto exchange, but has abandoned most of its global centralized exchange partners. The drastic decision comes after the massive recent failure of centralized exchanges.
Meanwhile, South Korea, among other countries, was the country most affected by the FTX collapse. A CoinGecko analysis confirmed that, on average, 297,229 unique South Korean users visit FTX.com monthly, making South Korea at the top of the list of countries most affected by the collapse of FTX.
South Korea, which you follow on Kriptokoin.com, recently gave an investment warning about the WAVES token.
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