Devastation as South Korea Coinbin exchange files for bankruptcy citing embezzlement

• Coinbin cites “increased debt” and “government regulation” as the key reasons behind the closure of its operations.
• Coinbin to take legal action against an executive who lost cryptocurrency private keys from Youbit.

A South Korea cryptocurrency exchange company, Coinbin is reported to have filed for bankruptcy after losing millions of dollars. The exchange cites embezzlement in the notice that was published on Wednesday.

The notice detailed “increased debt” and “government regulation” as the key reasons behind the closure of its operations. Precisely, the country’s regulator has refused to allow the exchange to issue virtual accounts to its customers in addition to rising overhead expenses and liabilities following the shutdown of the subsidiary platform, Youbit.

Business Korea reported on Friday that the exchange had recorded losses of about $26 million. Cash withdrawals from the exchange were stopped at 3.00 on Wednesday. The notice also told users to stop all deposits to their accounts. “The settlement of cash and [cryptocurrencies]will be carried out by all bankruptcy procedures,” the noticed directed.

A section of the noticed said the “corporate executive moral hazard” was largely behind the bankruptcy filing. Moreover, one of the executives lost paper wallets from its fallen subsidiary, Youbit that had “hundreds” of crypto private keys last year in November. Efforts are being made to have the funds recovered in addition to making “civil and criminal complaints” against the said executive.