Bithumb, South Korea's second-largest cryptocurrency exchange, will present a shareholder vote on March 31, 2024, to reappoint CEO Lee Jae-won for another two-year term. This comes despite the exchange's recent Bitcoin (BTC) "ghost" incident worth $44 billion, resulting in a record $24 million fine and ongoing investigations by three regulatory agencies.
The decision to retain the current leadership instead of replacing senior personnel shows that Bithumb is prioritizing operational stability, even though regulators are currently XEM the possibility of imposing further sanctions.
The $44 billion financial error case reveals
On February 6, 2024, a Bithumb employee, while organizing a promotional event , mistakenly entered BTC as the reward unit instead of Korean Won . The system automatically recorded a total of 620,000 BTC for 695 user accounts – approximately 15 times the amount of Bitcoin Bithumb actually held, which was only about 42,000 BTC.
The trading software treated these "ghost" balances as real. In just 35 minutes, some users sold or withdrew approximately 1,788 BTC, worth around $125-135 million, causing the price of Bitcoin on Bithumb to plummet by 17%. However, the global market remained unaffected.
Bithumb recovered 99.7% of the mistakenly recorded BTC on the same day . The exchange used company funds to cover the remaining losses and reimbursed affected parties 110% of their losses. No one lost money permanently, and on-chain balances remain safe.
However, during a congressional hearing on February 11, 2024, CEO Lee admitted that the exchange only reconciled internal balances with actual asset volumes once every 24 hours, and that similar minor errors had occurred before.
Three investigations into Bithumb are still ongoing.
The Financial Intelligence Unit (FIU) has imposed the largest fine ever on a virtual asset exchange in South Korea.
The 36.8 billion won (US$24 million) fine stems from 6.59 million violations of anti-money laundering regulations discovered during an inspection in 2025, according to Yonhap. In addition, Bithumb was also fined:
- Partially suspended from operations for 6 months,
- The CEO was reprimanded, and
- The compliance officer was also suspended for six months.
Two other investigations are still ongoing. The Financial Supervisory Service (FSS) is XEM potential violations of the Virtual Asset User Protection Act related to the incident on February 6, 2024.
A separate investigation by the FIU is XEM whether Bithumb Chia order data with Stellar Exchange – an unregistered exchange in Australia.
Crypto exchange in South Korea are not currently classified as financial institutions, meaning that reprimanding a CEO does not prevent them from continuing in their executive positions.
However, the precedent set by Upbit suggests the opposite trend. After Upbit 's parent company, Dunamu, was fined by the FIU in February 2025, CEO Lee Sirgoo resigned just three months later and transitioned to an advisory role, according to the Korea Times .
What will the vote on March 31st decide?
In addition to the CEO re-election, the shareholders' meeting will also XEM the following issues:
- Bithumb raises its bond issuance limit to 300 billion won (US$225 million).
- Appointing new auditors to strengthen internal controls, and
- Rename the affiliated company Bithumb A to “Bithumb Asset”.
Raising the bond issuance limit is XEM by many as preparation for future IPOs and a step towards strengthening market position.
Regardless of the voting results, investigations will continue. However, the outcome on March 31, 2024, will show whether Bithumb shareholders XEM prioritizing stability as an advantage or a risk, as confidence in the exchange's internal systems has not yet been fully restored.
