Korbit holds an education session on AML for its employees

Crypto Exchange Bithumb’s Operator Closing BusinessesBithumb Korea, the operator of a major South Korean cryptocurrency exchange, has been streamlining its businesses in response to its ongoing struggle to generate profits.Photo by Tim Mossholder on PexelsAccording to a report by local news outlet Business Watch, Bithumb Systems, a tech solution subsidiary of Bithumb Korea, has recently ceased operations. Bithumb System was launched in March of last year with the aim of advancing blockchain and exchange technology. However, due to the decline in the crypto industry and challenges in profitability, the company had to undergo liquidation.An official from Bithumb Korea explained that the decision to close its tech solution arm was made in order to prioritize improving the competence of the exchange amidst the changing landscape of domestic and foreign markets.Other affiliates of Bithumb Korea are also facing difficulties. For instance, Bithumb Live, an e-commerce platform jointly established by Bithumb Korea and content production firm Bucket Studio, has been on hiatus since October last year. The platform incurred a net loss of 10 billion KRW ($7.75 million). Bithumb Korea, holding 37.5% of Bithumb Live’s shares, invested 6 billion KRW ($4.65 million) into the platform in 2021. Bithumb Korea recognizes these investment losses using the equity method.Additionally, Bithumb META, despite raising the highest amount of funds among its sister affiliates, has encountered challenges in making much progress since its establishment last year. Its NFT marketplace, Naemo Market, is still without a mobile application, and the introduction of its metaverse platform is still pending. Although Bithumb META managed to attract 9 billion KRW in investments last March from esteemed companies such as LG CNS, CJ OliveNetworks, and SK Square, it incurred a loss of 7 billion KRW ($5.4 million) in 2022.Furthermore, earlier this month, it was reported that the exchange closed its research center due to a decline in trading volume, despite its importance in assisting investors to make better-informed decisions.A representative from Bithumb stated that the company is actively seeking new sources of revenue through its mobile Wallet platform operator, Rotonda, and Bithumb META. However, given the market slowdown, Bithumb is now compelled to prioritize enhancing the competence of the exchange.

Bitzlato co-founder to pleads guilty in US to illicit funds processingAnatoly Legkodymov, the co-founder and majority owner of Hong Kong-registered virtual currency exchange Bitzlato, entered a guilty plea in a U.S. court on Wednesday in relation to illicit funds transfer activity.Photo by Max Sandelin on UnsplashNew York court appearanceAccording to a Department of Justice press release, Legkodymov, a Russian national, appeared before U.S. District Judge Eric Vitaliano for a “criminal cause for pleading,” signaling a guilty plea.Legkodymov, 41, was arrested in Miami on Jan. 17 and has been held at the Metropolitan Detention Center (MDC) in Brooklyn since then. U.S. authorities accused him of processing approximately $700 million in illicit funds through Bitzlato, a platform headquartered in Hong Kong.The charges related to operating the platform as an unlicensed money exchange business. Allegedly, he engaged in significant cryptocurrency swaps with Hydra Market, described as a marketplace involved in drugs, stolen financial information and money laundering services.United States Attorney for the Eastern District of New York, Breon Peace stated:“Legkodymov’s guilty plea today confirms that he was well aware that Bitzlato, his cryptocurrency exchange, was being used like an open turnstile by criminals eager to take advantage of his lax controls over illicit money transactions.”The Department of Justice maintained that Bitzlato becoming “a haven for criminal proceeds and funds intended for use in criminal activity” was as a result of its “deficient know-your-customer (KYC) procedures.”Website taken downBitzlato’s website has been replaced by a notice stating that the service was seized by French authorities as part of an international law enforcement action coordinated with U.S. and German law enforcement shutting down Hydra Market in April 2022.This guilty plea is the latest development in U.S. law enforcement’s broader efforts to crack down on fraud and illicit financial activities within the cryptocurrency markets. In recent cases, FTX founder Sam Bankman-Fried was convicted for stealing billions from customers, while Binance agreed to a $4.3 billion settlement, with CEO Changpeng Zhao (CZ) pleading guilty to violating U.S. anti-money laundering laws. Binance was identified as one of Bitzlato’s top counterparties by U.S. authorities.Russia calls for Legkodymov’s releaseDespite calls from Russia’s embassy in Washington for Legkodymov’s release and an embassy visit to him in jail, the U.S. State Department confirmed that Russia rejected a proposal for the release of two Americans, including Wall Street Journal reporter Evan Gershkovich. This follows Russia’s denial of a U.S. embassy request to visit Gershkovich. The diplomatic exchanges underscore the international dimension of the case and the geopolitical tensions surrounding the detention of individuals in both countries.As U.S. law enforcement continues its efforts to combat cryptocurrency-related crimes, the anticipated guilty plea of Bitzlato’s co-founder highlights the regulatory scrutiny and consequences faced by those involved in illicit financial activities within the crypto industry.

Korean Crypto Market Outpaces Stock Exchange Amid Bitcoin ETF OptimismThe anticipation is building around the potential approval of BlackRock’s Bitcoin exchange-traded fund (ETF) in the United States. As the world’s largest asset manager is anticipated to obtain a green light, Bitcoin’s price has surged by more than 17% just this week, capturing the keen interest of investors.Photo by Kanchanara on UnsplashCrypto surpassing stocks in daily trading volumeIt’s worth highlighting the surge in the Korean cryptocurrency market, where the daily trading volume has recently eclipsed that of the Korean Composite Stock Price Index (KOSPI).According to local news outlet Maeil Business Newspaper, on October 24, KOSPI recorded a trading volume of KRW 7.83 trillion ($5.8 billion). Yet, in a 24-hour span from 9 a.m. (KST) on October 23 to 9 a.m. on October 24, the combined trading volume of the top five Korean cryptocurrency exchanges reached KRW 8.44 trillion.Breaking it down by exchange, Upbit had a 24-hour trading volume of KRW 6.97 trillion, followed by Bithumb with KRW 1.36 trillion, Coinone with KRW 87.6 billion, Korbit with KRW 18.8 billion, and Gopax with KRW 2.2 billion.Retail investors leaving the stock marketThe surge in the Korean crypto market is largely due to retail investors shifting their focus away from the Korean stock market. This move comes in response to challenges the stock market has been grappling with, such as monetary tightening in the US and increased volatility stemming from the Israel-Hamas war.