Bithumb’s Hong Kong affiliates are reportedly facing a civil suit for breach of contract.
According to a Tuesday report by the Korea Times, the suit is being initiated by a former Bithumb partner in Thailand, which is accusing the South Korean-headquartered exchange of unilaterally halting its business in Thailand and causing major losses.
The Thai firm — which remains unnamed — is reportedly preparing to file a lawsuit against Bithumb’s Hong Kong subsidiaries, including Bithumb Global Holdings and GBEX, as well as top company executives in July.
According to the plaintiff firm, Bithumb’s Hong Kong-based entities were allegedly involved in the company’s previous plans to open a Bithumb exchange in Thailand. Some of the executives of these subsidiaries also hold high-level positions at Bithumb Korea, the plaintiff reportedly said.
After founding an entity in Thailand back in 2018, Bithumb reportedly backed off on its plans in the country, allegedly causing significant damages to its Thailand partner. The plaintiff claims that Bithumb did not have any real intention to establish a crypto exchange in Thailand and that it attempted to sell its BXA coins by exaggerating the size of its global presence.
“After Bithumb stopped its BXA coin business, its Thai operation became unnecessary, so the company ended its business in Thailand unilaterally, causing serious damage to us,” the former Thai partner said. A spokesman for the firm noted that Bithumb Global Holdings and GBEX collectively own a 49% stake in the joint venture in Thailand and are fully-owned subsidiaries of Bithumb Korea.
The plaintiff elaborated that they decided to file lawsuits against Bithumb’s Hong Kong entities, as they are related to the Thailand issues more directly than other Bithumb subsidiaries.
The firm added that the company is considering filing a separate similar lawsuit on behalf of Bithumb’s former partner in Japan as well.
As previously reported, Bithumb has been involved in legal controversy over promoting its BXA token, which has never been launched or listed. Through BXA token sales, Lee Jung-hoon, chairperson of the board at Bithumb Korea and Bithumb Holdings, allegedly became involved in a major fraud causing investor damages of up to $25 million. Last year, South Korean authorities reportedly conducted multiple raids of Bithumb’s offices as part of a related investigation and a court action.