The Korean Economic Daily reported on December 24 that Bithumb, A South Korean crypto exchange has successfully won a lawsuit where the company was accused by the investor of a loss of $355,000 in an alleged hack. According to reports, Ahn Park, a 30 years old civil servant purported that he has been the victim of a hack. He said that his Bithumb account was hacked on November 30, as a result of which Ahn lost 400 won (Korean currency).
Mr Park says that as soon as he deposited the money, his currency was exchanged for Ethereum by an unidentified hacker. On the very same day, the cryptocurrency was transferred from his account in 4 different transactions. According to Mr Park, he was only left with Ethereum worth 121 won at the end of it.
Parks case essentially highlighted that Bithumb has miserably failed to offer security which is satisfactory concerning their responsibility as a firm managing public money. He suggested that his personal information was leaked in October 2017 wherein hackers gained access to data of 30,000 Bithumb users.
Yonhap reported that 10 or more SMS were sent to this particular claimant letting him know about withdrawal movements, but he didn’t receive them. Parker also pitched an argument saying that the activities of this crypto exchange are no different from the services offered by various other firms in the financial sector. He went on to say that Bithumb is subject to the security requirement which complies with electronic commerce transaction brokers.
The argument made by Mr Parker was ruled out by the judge. He said that ‘In general, virtual currencies cannot be used to buy goods and it is difficult to guarantee their exchange for cash because their value is very volatile. [Cryptocurrencies] are mainly used for speculative means, [and it] is not reasonable to apply [Korea’s] Electronic Financial Transactions Act to a defendant who brokers virtual currency transactions without the permission of [South Korean regulator] the Financial Services Commission.’
Previously, Bithumb refused to accept allegations of infiltrating its trade volumes artificially after CER accused the exchange of using wash trading in the late summers of 2018. At the moment, Bithumb is not listed in the rankings of CoinMarketCap for crypto exchanges by adjusted volume, However; it tops the charts in CMC ’s separate rankings based on self-reported statistics.