Bithumb, South Korea’s largest crypto exchange by trade volume, has been cleared of concerns over potential malpractice, suspicious business activities and possible tax evasion after a three-month intensive investigation by the Korean Government. Local news media report June 8.
Bithumb was targeted by some South Korean government agencies, including the Financial Services Commission (FSC), the National Tax Service (NTS), and the Korea Financial Intelligence Unit (KFIU) after investors raised concerns over dubious business practices.
According to the reports, the investigation into the crypto exchange commenced on Jan 10, the FSC, NTS, and KFIU sent government officials to the Bithumb Crypto exchange headquarters in Seoul, seizing various devices, computer files, and information needed to run a full audit on Bithumb’s digital asset holdings and past activities.
Reportedly, the three-month-long investigation, which NTS touted as an “intense and extensive” inspection, focused on the balance sheet and transaction history of the exchange, mainly to evaluate the tax payouts of the crypto exchange.
Notably, the government agencies found no evidence of dubious business practices, illegal activities, and tax evasion. A $28 million tax was imposed on Bithumb, and the NTS closed the investigation into Bithumb officially, clearing the crypto exchange.
2017 was a break out year for digital currencies, the total market cap for all digital tokens surpassed $100 billion. Bithumb similar to other crypto exchange benefited from the meteoritic surge in demand for the trading of cryptocurrency. Bithumb profits had allegedly increased 171-fold over the 12 months duration leading to the NTS investigation, though it’s probable that much of that was garnered simply by the appreciation of many cryptocurrencies over the year.
“NTS began several investigations into Bithumb cryptocurrency exchange between 2014 and 2017, and over the past four years, Bithumb has continuously paid all of the taxes imposed to the company without any conflict with the NTS.” Said NTS representative.