South Korean Crypto Exchange Coinbin Goes Bankrupt after $26 Million Embezzlement by Ex-Employee

A crypto exchange by the name Coinbin based in South Korea announced on Feb. 20 that it will be filing for bankruptcy soon. The shocking news came as a result of the unpleasant turn of events in the company.

Before we get into the story, it is worthy to recall that another exchange, Youbit, suffered a devastating financial loss in 2017 due to a hack, which made it lose about 17 billion won; as a result, Coinbin took control of the firm after the incident. Also, in April of that very same year, another crypto firm named Yapizon struggled with a disaster after it lost a total of 5.5 billion won due to a similar hack. As if tragedy comes in threes, Coinbin is now in the news for the loss of up to 29.3 billion won due to an employee’s embezzlement. Let’s get to the story then.

A former employee who apparently had been the former chief executive officer of Youbit is accused of embezzling funds tallying at a whopping 29.3 billion won (approximately $26 million USD).

This shocking turn of events left the crypto firm with a huge amount of debt which may be too much of a burden for the company to go on anytime soon. Therefore, the chief executive officer of Coinbin Park Chan-kyu announced from his Seoul office that the company is preparing to file for bankruptcy soon. In addition, the firm has reportedly ceased crypto related exchange including cash withdrawal since the time of the announcement – 3:00 pm Feb. 20.

Chan-kyu added that all forms of settlement, both cash and cryptocurrency settlement, will commence in line with the laid down bankruptcy procedures. Commenting on the incident, Chan-kyu explained that the employee who had embezzled the funds was in charge of managing the affairs of Youbit.

According to Chan-kyu, the ex-employee claimed to have made a fatal error while in fact his actions were intentional. The employee claimed to have removed tons of cryptographic keys to varied crypto wallets containing hundreds of Bitcoin (BTC), and to lose other crypto wallet addresses containing over a hundred digital coins of Ethereum (ETH). This supposed mistake which occurred back in November now clearly seems as a deliberate deed of embezzlement, making it an intentional act and not a mistake as the employee confessed earlier.

Chan-kyu stated that the employee is an expert in the crypto sphere, and as such, his supposed mistake raises a whole lot of dust. He believes it was a well crafted plan to help him do away with the firm’s funds. The amount of damage, according to Chan-kyu, is estimated at 29.3 billion won. This includes 2.3 billion won lost as virtual coin and a majority of 27 billion won which was used as a compensation of some of the old firm’s [Youbit] members.

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