Bithumb's fall from grace: How scandals derailed South Korea's crypto giant
Bithumb, once South Korea's leading cryptocurrency exchange, has faced a sharp decline in market dominance since 2023. A series of setbacks—including regulatory fines, a major hack, and a recent trading error—have cut its share from nearly half the market to under 30%. The company has now delayed its long-awaited IPO until 2028 as it works to rebuild trust and strengthen internal controls.
Bithumb's troubles began in late 2023 when regulators imposed an $80 million fine for past violations. The penalty, combined with stricter financial rules, weakened its position against rivals like Upbit, which gained ground by emphasising compliance. By early 2024, a costly hack further drained resources, pushing the exchange's market share below 25%.
The company briefly recovered in 2025, lifting its domestic share above 30% and reporting around $430 million in revenue. However, another blow came in early 2026 when a trading error accidentally distributed roughly 620,000 Bitcoin—worth an estimated $43 billion. South Korea's Financial Supervisory Service swiftly launched an investigation into Bithumb's risk management and internal controls. Originally targeting a public listing in late 2025, the exchange has now pushed back its IPO to 2028. Chief Financial Officer Jeong Sang-gyun confirmed the delay at the annual shareholders meeting, citing the need for stronger accounting policies. To prepare, Bithumb signed an advisory agreement with Samjong KPMG, extending through 2027. Regulatory pressure has intensified further. The Financial Intelligence Unit recently fined Bithumb $27 million and ordered a partial suspension of operations, adding to its challenges.
Bithumb's market share has fallen to around 20-25%, far behind Upbit's 60-70% dominance. The delayed IPO, regulatory fines, and ongoing investigations mean the exchange must now focus on rebuilding its systems and reputation. A successful listing in 2028 will depend on whether these measures restore investor and regulator confidence.
