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Highlights
- Seoul Court criticizes Bithumb for procedural failings in XENT delisting case.
- Bithumb faces $155K in fees under new S. Korea crypto regulation.
- Bithumb to drop AGIX post-SingularityNET merger into ASI token.
Bithumb, South Korea’s second-largest crypto exchange has come under fire from the Seoul Central District Court for handling the injunction lawsuit concerning the delisting of the XENT token. The court described the exchanges’ argument that it did not respond to the lawsuit due to an internal procedural issue as “unreasonable” and argued that an apology to investors should be made.
The issue arose in a hearing when the court challenged the exchanges’ explanation and expressed concerns regarding the effects of internal mistakes on investors.
Bithumb Under Fire by Seoul Court Over XENT Lawsuit
In the course of the hearing, Bithumb Korea stated that it did not reply to the injunction lawsuit due to an email delivery problem therefore, the department in charge was not informed about the case. The court, however, rejected this reason, noting the implications of such procedural lapses.
The court noted that the price of XENT had risen by 1400% since the grant of the injunction, which could have led to new investors being lured into the market by the company’s failure to promptly notify its clients.
In addition, the court also demanded that the crypto exchange apologize to investors for not promptly responding to the lawsuit. However, the firm tried to justify the circumstances and the court was not convinced and the court also expressed its concern over the handling of the issue and its effects on the investors’ trust.
SDKB Clash Over Delisting
During the hearing, the firm and SDKB, the operator of the Cent Project, were at odds regarding the termination of trading support for XENT. SDKB identified that the security threats that made XENT as a stock to watch had been addressed but Bithumb decided not to reinstate the trading support for business continuity concerns.
Consequently, the SDKB criticized the crypto exchange for not disclosing the internal standards used to evaluate business sustainability. However, Bithumb defended its decision, stating that exchanges need discretionary power to manage non-performing companies effectively.
According to the firm, its actions were taken within the fair standards and to preserve the order on the exchange.
Regulatory and Operational Challenges
Amid the ongoing legal issues surrounding the XENT token, the firm is also facing additional challenges. As of the Virtual Asset User Protection Act, South Korea has directed that crypto exchanges such as Bithumb must pay supervisory fees.
The fee of the exchange is 21.14 million won ($155,157) which shows the increasing legal expenses that the exchange has to bear due to the enhanced supervision of the exchanges by the regulatory authorities.
Additionally, the firm has announced it will withdraw support for the SingularityNET (AGIX) token. This decision follows the project’s merger with FET and OCEAN into a new token called the Artificial Superintelligence (ASI) token.
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