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Bithumb moves to reappoint CEO amid AML probe pressure

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Bithumb moves to reappoint CEO amid AML probe pressure

Bithumb is moving to retain CEO Lee Jae-won as the South Korean crypto exchange faces regulatory pressure and fresh scrutiny over compliance controls. Shareholders are expected to vote on his reappointment at the company’s regular meeting on March 31.

Summary

  • Bithumb seeks CEO Lee’s reappointment despite AML penalties and ongoing regulatory investigations in South Korea.
  • Exchange faces transfer restrictions, fines, and scrutiny over a major Bitcoin promotion error.
  • South Korea’s growing crypto market adds pressure as Bithumb prepares for license renewal.

Bithumb will reportedly ask shareholders to approve another two-year term for Lee Jae-won. His current term ends at the close of March. If shareholders approve the proposal, Lee will continue leading the exchange during a period of regulatory pressure.

The reported move comes as Bithumb remains the second-largest crypto exchange in South Korea by trading volume, per CoinGecko data. The company continues to hold a strong market position behind Upbit, while Korbit remains smaller by comparison.

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Regulatory action adds pressure

Bithumb has recently faced action from South Korea’s Financial Intelligence Unit. In March, the regulator reportedly imposed a six-month partial suspension and a 36.8 billion won fine over alleged anti-money laundering failures.

Under the reported measures, new customers will not be allowed to make external crypto transfers from March 27 through Sept. 26. The case has added pressure on the exchange as it manages compliance and prepares for future licensing requirements.

Moreover, the exchange also drew attention in February after it reportedly credited users with 2,000 Bitcoin instead of 2,000 won during a promotional campaign. That error led to the distribution of 620,000 coins that the exchange could not support.

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Bithumb is also waiting for the outcome of another probe linked to alleged order book sharing with an overseas platform. According to the Korea Times, an industry official said, 

”Bithumb will be on edge awaiting the results of ongoing regulatory probes, as the company still needs to renew its virtual asset service provider license.”

South Korea’s crypto market keeps growing

The leadership decision comes as South Korea’s crypto market continues to expand. The sector has seen stronger policy support since President Lee Jae-myung took office and advanced crypto-related measures, including a bill tied to stablecoins.

Crypto ownership has also risen sharply in the country. Earlier data showed South Korean crypto exchange users had surpassed 16 million, equal to more than 30% of the population. Market estimates also project the country’s crypto sector could generate $1.3 billion in revenue in 2026.

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Crypto World

ZachXBT Exposes Fake Accounts Driving Crypto Scams on X

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ZachXBT Exposes Fake Accounts Driving Crypto Scams on X

Blockchain sleuth ZachXBT said Monday he uncovered a coordinated network of accounts on X using exaggerated or fake war and geopolitical posts to lure users into crypto scams.

The investigation identified more than 10 linked X accounts allegedly purchased with follower bases that pushed sensational content and scam links, according to an X thread and screenshots shared by ZachXBT.

The fake accounts used AI to impersonate prominent social media influencers such as Mario Nawfal, flooding X with “doomposts” and driving engagement before promoting fake crypto giveaways and pump-and-dump token schemes. “Onchain evidence suggests the scheme profited six figures,” ZachXBT said, adding that the group has been farming engagement and may be preparing another scam.

The report highlights the persistent problem of fake accounts and bot activity on social media platforms like X, even as the company says it is taking steps to combat such behavior.

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Scam mechanics based on viral geopolitical posts

According to ZachXBT, the scheme started with accounts that had existing followers. These accounts repeatedly posted exaggerated war or political content, often sensational or misleading, which quickly went viral and attracted millions of views.

Once attention peaked, the fake accounts pivoted to promote fraudulent token giveaways or scam tokens. One such promotion involved the pump-and-dump crypto scam referred to as Oramama on Feb. 22, ZachXBT noted.

Source: ZachXBT

ZachXBT spotted numerous large accounts in the replies and quotes that fell for the engagement bait, only to boost the post’s reach unknowingly.

Social media’s scam problem persists despite platform changes

The revelation comes as social media platforms like X have been trying to clamp down on bots and scam activity.

Last month, X’s product chief Nikita Bier announced enhanced anti‑bot detection and removal measures, along with user flags for AI‑generated content, as part of broader efforts to curb automated spam and misinformation.

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Source: Nikita Bier

Still, the ZachXBT findings expose how quickly coordinated accounts can build engagement and mislead users.

Related: Coinbase-backed CoinDCX founders questioned in fraud case: Report

The investigator suggested that platform manipulation should lead to bans and legal consequences, calling social media users to review recent posts and account details before engaging with any content.

ZachXBT also shared a list of X users he believes to be involved in the scam in case they change usernames or deactivate their accounts.

Magazine: Are DeFi devs liable for the illegal activity of others on their platforms?

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