Korean Traders File Class Action Lawsuit Against Bithumb Over Server Outage
- The exchange is getting heat from customers as the outage occurred while Bitcoin Cash was printing fresh highs.
A class-action lawsuit has been filed against one of the largest Bitcoin exchanges in the world, Bithumb, over issues stemming from its server outage which went down on November 12.
The Korean exchange is getting heat from customers as the outage occurred while Bitcoin’s lesser-known cousin, Bitcoin Cash, was printing fresh highs over the weekend, hitting uncharted records before plunging sharply. Monetary losses from Bithumb’s users have started to surface, and are quickly reaching into the billions of won - the loss of one customer was reported at 250 million won ($223,000).
Bitcoin Cash surged from $350 all the way to a new all-time high of over $2,400 on November 12, after key members of the cryptocurrency community decided to call off the third fork of Bitcoin, SegWit2x, leading some investors to rotate into different currencies.
While Bitcoin Cash was soaring, the Seoul-based exchange’s server crashed for nearly two hours. In the aftermath, some customers complained that they were unable to take advantage of the digital currency’s fluctuations.
Bithumb attributed the outage to the huge trading volume which increased almost eight-fold relative to its average in October, as prices of Bitcoin Cash and other Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term experienced wild trends.
Around 3,000 plaintiffs are seeking unspecified damages and compensation for legal fees, as well as certification for class-action status. At the time, Bithumb said that it is still discussing how it will move to pay back users, apologizing for the losses and stating that the exchange "will meet its legal and social responsibilities concerning this issue."
The document corresponding to the lawsuit states that one of the main reasons for the claim is the fact that Bithumb was previously hacked in June, and personal data of nearly 30,000 customers has been compromised.
It is unclear whether Bithumb is really serious about compensating for its users’ losses and how the amount of damages can be confirmed. Even if the damages are proven, the situation is complicated by a lack of Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term regarding crypto assets, which have not been recognized in South Korea.
According to a local newspaper, an official of the country's Financial Supervisory Commission was quoted saying: "As the size of virtual currency transactions increases and the price surges, there are many speculative factors and crimes such as receipt of similar and hacking are continuing. Virtual currency is not financial money nor financial investment products at present. The government says you should do it at your own risk, even if you do not recommend the transaction."
A class-action lawsuit has been filed against one of the largest Bitcoin exchanges in the world, Bithumb, over issues stemming from its server outage which went down on November 12.
The Korean exchange is getting heat from customers as the outage occurred while Bitcoin’s lesser-known cousin, Bitcoin Cash, was printing fresh highs over the weekend, hitting uncharted records before plunging sharply. Monetary losses from Bithumb’s users have started to surface, and are quickly reaching into the billions of won - the loss of one customer was reported at 250 million won ($223,000).
Bitcoin Cash surged from $350 all the way to a new all-time high of over $2,400 on November 12, after key members of the cryptocurrency community decided to call off the third fork of Bitcoin, SegWit2x, leading some investors to rotate into different currencies.
While Bitcoin Cash was soaring, the Seoul-based exchange’s server crashed for nearly two hours. In the aftermath, some customers complained that they were unable to take advantage of the digital currency’s fluctuations.
Bithumb attributed the outage to the huge trading volume which increased almost eight-fold relative to its average in October, as prices of Bitcoin Cash and other Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term experienced wild trends.
Around 3,000 plaintiffs are seeking unspecified damages and compensation for legal fees, as well as certification for class-action status. At the time, Bithumb said that it is still discussing how it will move to pay back users, apologizing for the losses and stating that the exchange "will meet its legal and social responsibilities concerning this issue."
The document corresponding to the lawsuit states that one of the main reasons for the claim is the fact that Bithumb was previously hacked in June, and personal data of nearly 30,000 customers has been compromised.
It is unclear whether Bithumb is really serious about compensating for its users’ losses and how the amount of damages can be confirmed. Even if the damages are proven, the situation is complicated by a lack of Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term regarding crypto assets, which have not been recognized in South Korea.
According to a local newspaper, an official of the country's Financial Supervisory Commission was quoted saying: "As the size of virtual currency transactions increases and the price surges, there are many speculative factors and crimes such as receipt of similar and hacking are continuing. Virtual currency is not financial money nor financial investment products at present. The government says you should do it at your own risk, even if you do not recommend the transaction."