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Crypto Exchange Bithumb ‘Not Liable’ for Customer’s USD 401,000 Losses

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The South Korean market-leading crypto exchange Bithumb has won its legal struggle against an investor who accused it of negligence, claiming he lost USD 401,000 in cash after a 2017 data breach.

The Supreme Court of Korea. Source: Adobe/Rex Wholster

Per news agency Yonhap, a man identified only as “Mr. A” for legal reasons, alleged that he had been holding the KRW funds on the exchange, but that his personal data was compromised in a data leak in 2017 – and the money was subsequently lost.

Mr. A was unsuccessful in his first bid to win damages payments from Bithumb, but had been hopeful of overturning the decision at an appeals hearing.

In an appeals hearing held at a branch of the Seoul High Court, Mr. A told the judge that a hacker accessed his account, used the KRW holdings to purchase ethereum (ETH) tokens – and then converted the said tokens to fiat in four separate transactions.

The hacker, the court heard, was able to access a verification code sent to Mr. A’s mobile phone in order to authenticate the transactions.

Bithumb was found liable and punished for some 36,000 cases of personal data leakage in December 2017.

However, the judge at the High Court hearing stated that there was no evidence that proved Mr. A’s personal data was among those exposed in the 2017 data leaks, meaning there was insufficient evidence to prove that Bithumb was indeed liable.

A number of investors have previously made similar allegations, with limited success. Earlier this month, the exchange was declared “partially liable” for one customer’s USD 27,200 losses in a data-breach related case dating back to 2017 – and was ordered to pay USD 5,000. However, two other claimants lodging cases at the same time lost their own legal battles against the exchange.

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