Coinbin, a cryptocurrency exchange based in South Korea, has filed for bankruptcy, causing financial damage estimated at over $26 million. According to a February 22 report from Business Korea, Coinbin CEO Park Chan-kyu announced the bankruptcy on February 20, citing employee embezzlement as the reason.
In an interview with reporters, Park said that all cryptocurrency and cash withdrawals from the exchange were halted and that both crypto and cash settlements would be done in accordance with bankruptcy procedures.
Park revealed an executive in charge of cryptocurrency balances at the exchange had committed dereliction of duty and embezzled company funds. The executive previously served as the CEO of Youbit, a cryptocurrency exchange that suffered a hack of 17 billion won. Coinbin took over Youbit at the end of 2017, hoping to revive the exchange.
The executive reportedly claimed that he had removed hundreds of cryptographic keys to coin wallets containing hundreds of Bitcoin and lost the cryptographic key to a wallet containing more than 100 Ethereum coins last November, Business Korea reported.
Park, however, asserted that it was not a mistake but an intentional act. In his words, the employee in question is a cryptocurrency expert and was not likely to make such a mistake. According to Park, the damage the exchange has suffered is estimated at 29.3 billion won, which is around $26 million. This includes 27 billion won to be used for compensation of some former members of Youbit and 2.3 billion won of lost coins, reports showed.