Bithumb's IPO Hopes Clouded by Complex Ownership, Regulatory Risks

Bithumb's push for an initial public offering (IPO) has been ongoing since 2020, but the cryptocurrency exchange faces significant hurdles. One major obstacle is its complex ownership structure, which runs from Lee Jung-hoon, the former chairman and founder of Bithumb Holdings, through a tangled web of shareholding relationships.

The company's ownership chain involves several investment firms between Lee and Bithumb Holdings, as well as numerous companies and individuals linked through shareholding relationships. According to filings with the Financial Supervisory Service (FSS), Lee owns 50% of SG Brain Technology Consulting (SG BTC) in Singapore. BK Group Chairman Kim Byung-gun is the second-largest shareholder, holding a 49.99% stake.

The complicated ownership structure has fueled disputes over management control since 2018 and embroiled Lee in a prolonged legal battle with BK Group over its proposed acquisition of Bithumb. The exchange is also facing regulatory risks, including an administrative lawsuit challenging a partial business suspension and fine imposed by the Korea Financial Intelligence Unit.

Bithumb's application to renew its registration as a virtual asset service provider has remained pending for an extended period, and the company plans to accelerate preparations for the listing by strengthening internal control systems and refining accounting standards. Bithumb officials stated that they will 'systematically fulfill the remaining listing requirements' to become a company that earns market trust.

Industry experts believe that a successful listing could trigger a broader re-rating of the virtual asset sector, providing a key benchmark for investors. Ryan Yoon from Tiger Research noted that the Korea Exchange's listing review places emphasis on legal risks involving beneficial owners and the transparency of major shareholders' ownership structures.