It should be noted that more often than not, news about the departure of executives of large companies is presented positively. For example, Jesse Powell said that he was simply tired of running Kraken, a cryptocurrency exchange. However, he intends to remain involved in the development of the platform he founded.

Former Kraken executive Jesse Powell

He commented on the event as follows.

I look forward to devoting more time to the company’s products, their usability and greater protection of the industry.

Among examples of such is Michael Saylor, the former head of MicroStrategy, which is the largest Bitcoin holder among publicly traded companies. He announced in early August that he was ceasing to be a director of the firm and instead became executive chairman of the company.

Former MicroStrategy executive Michael Saylor

However, as it became clear shortly after the announcement, MicroStrategy’s course and attitude towards BTC will not be affected. Still, Sailor is still making decisions because of the abundance of shares at its disposal and its special type.

However, today’s situation is much less pleasant.

Can cryptocurrencies go to jail?

We’re talking about Lee Jong-hoon, the former chairman of Bithumb Holdings, which at the same time runs the cryptocurrency exchange Bithumb. The platform is the second largest trading platform in South Korea, meaning it is in demand.

According to Decrypt officials, Jong Hoon faces up to eight years in prison if he is found guilty on charges of alleged $70 million fraud.

A court hearing was held on October 25 at the Seoul District Court, with the final decision in the case to be announced on December 20
.

The logo of cryptocurrency exchange Bithumb

According to the prosecution, Lee allegedly received money from BK Group founder Kim Byungun. This allegedly took place in October 2018 during negotiations over the possible sale of Bithumb. Kim had tentatively intended to buy 50 per cent of the exchange, with the aforementioned 70 million allegedly paid by investors as a commission. The transaction took place after Kim was promised a token called Bithumb Coin (BXA), the proceeds of which were to be used to finance the transaction.

Since then, the token has never appeared on Bithumb, so the idea of Kim buying the platform was rejected.


The lawsuit was eventually filed by investors who had invested in BXA. However, during the course of the case, Kim escaped any punishment as he was found to be a victim of deception on the part of Lee.


The prosecution views the situation as a ploy in which Lee decided to defraud his partner, even though he never intended to list the token on the exchange. At the same time, Lee’s lawyer assured that the structure of the case was essentially a typical share sale agreement, which on top of that was drafted according to the rules.

Bithumb stock exchange logo in the office

Several witnesses were summoned to the hearing, but did not attend due to their medical condition. Among them was the current chairman of Bithumb, Kang Jung-hyun. The commentary considering what happened was as follows.

The former Bithumb chairman has once again submitted a written statement of absence, although he himself has a huge impact on the exchange as a major shareholder.

As sources have clarified, Lee provided a medical certificate as an explanation for his own absence, which confirmed the need for medical treatment for three months. However, the diagnosis was made 19 months ago.

It should be noted that this is not the only recent news that negatively affects the reputation of digital assets. The day before, Singapore’s financial regulator proposed restricting the use of leverage in cryptocurrency trading, essentially banning leveraged transactions from cryptocurrency exchanges.

According to the rules, trading platforms will not only be unable to open leveraged trading positions, but also to accept user payments using credit cards. As sources note, such restrictions will affect regular retail users, while professional institutional investors will have access to all trading tools.

Cryptocurrency theft

The proposals in question have been voiced by Monetary Authority of Singapore officials, with the proposals themselves aimed at reducing “risks of harm to users”. The regulators also sounded off on informing people of the “risks associated with cryptocurrencies and related services” as a goal.

The document contains the following quote in this regard.

Many retail customers may not have sufficient knowledge of the risks associated with trading in digital payment tokens. This ends up causing them to take on too much risk.


Traditionally, this ends up in financial losses that no one will reimburse. Regulators therefore want to at least limit the number of such cases.


BitHumb exchange


We do not think that such situations are good for the reputation of digital assets. However, it happens in other areas of human activity as well, so cryptocurrencies are not to blame here. Coins continue to be decentralised assets that allow everyone to truly own their own money without being dependent on banks.


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