South Korean prosecutors recently conducted a raid on Bithumb, a prominent cryptocurrency exchange, in connection with allegations of embezzlement involving the company’s former CEO. The investigation revolves around suspicions that Bithumb misused company funds to aid the ex-CEO in acquiring an apartment. Specifically, the probe focuses on a substantial $2 million security deposit reportedly provided by Bithumb for renting an apartment in Seoul for Kim Dae-sik, the former CEO who currently serves as an advisor to the company.

The Seoul Southern District Prosecutors’ Office initiated the inquiry and carried out searches at Bithumb’s main office in Yeoksam-dong and other premises. This development comes amidst a series of legal troubles faced by Bithumb, including previous tax investigations and a prior raid related to allegations of price manipulation. Notably, Bithumb is contemplating the possibility of listing its shares on the Nasdaq, a move that underscores the exchange’s ambitions for broader market presence.

According to reports, the Financial Supervisory Service, South Korea’s financial regulatory body, undertook an initial review of the case before escalating it to the prosecutors. A spokesperson from Bithumb, as cited by The Chosun Daily, admitted to certain aspects of the allegations, indicating that Kim Dae-sik had repaid the borrowed sum in full subsequent to securing a loan for this purpose.

This latest incident adds to the string of legal challenges that Bithumb has encountered in recent times. The exchange’s engagement in various legal disputes has drawn regulatory scrutiny and raised questions about its operational practices. Despite these challenges, Bithumb’s consideration of a prospective Nasdaq listing demonstrates its strategic intentions to enhance its standing in the financial markets.

When approached for comments, Bithumb was not immediately available to respond to inquiries from CoinDesk. The situation remains fluid as authorities delve deeper into the embezzlement allegations, signaling a potentially turbulent period for one of South Korea’s leading cryptocurrency exchanges.