Lee Yeon-woo is a financial journalist at The Korea Times. Her wide range of reporting includes policies, macroeconomics, stock market, companies and even crypto. She is passionate about connecting the dots in Korean finance and making it easier for foreign nationals to understand. Based on her previous experience as a national reporter, she also has a keen interest in social issues within the sector, including gender equality and ESG. Your tips and insights are always appreciated. You can send them to yanu@koreatimes.co.kr.
Bithumb's IPO push clouded by complex ownership, regulatory scrutiny
A customer lounge of Bithumb in Seoul, Feb. 10 / Yonhap
By Lee Yeon-woo
Bithumb is renewing its push for an initial public offering (IPO), but the cryptocurrency exchange still faces significant hurdles stemming from its complex ownership structure and heightened regulatory scrutiny, industry officials said Wednesday.
The company has been pursuing an IPO since 2020 but has been unable to complete the process for more than six years.
One of the biggest unresolved obstacles to its listing is its complex ownership structure.
In simplified terms, Bithumb's ownership chain runs from Lee Jung-hoon, the former chairman and founder of Bithumb Holdings, through Bithumb Holdings and ultimately to Bithumb. However, several investment firms sit between Lee and Bithumb Holdings, while numerous companies and individuals are linked through a tangled web of shareholding relationships.
According to filings with the Financial Supervisory Service (FSS), Lee owns a 50 percent stake in SG Brain Technology Consulting (SG BTC), a Singapore-based company at the top of the exchange’s ownership structure. BK Group Chairman Kim Byung-gun, a plastic surgeon, is the second-largest shareholder, with a 49.99 percent stake.
SG BTC controls Singapore-based BTHMB Holdings, which in turn owns stakes in two Korean entities, DAA and Bithumb Holdings.
Bithumb Holdings, the group's key holding company, is 34.2 percent owned by DAA, 30 percent by Vidente and 10.69 percent by BTHMB Holdings. Other shareholders hold a combined 25.1 percent stake. Bithumb Holdings, in turn, owns a 73.56 percent stake in Bithumb, the operator of the cryptocurrency exchange.
The complicated ownership structure has fueled a series of disputes over management control since 2018. Lee is also embroiled in a prolonged legal battle with BK Group over its proposed acquisition of Bithumb.
Lee Jung-hoon, former chairman and founder of Bithumb Holdings, attends a court hearing at the Seoul Central District Court in October 2022. Newsis
Regulatory risks surrounding Bithumb are also mounting. The exchange is pursuing an administrative lawsuit challenging a partial business suspension and a fine imposed by the Korea Financial Intelligence Unit in March.
The FSS has also begun sanctions proceedings over a massive erroneous Bitcoin payment incident in February and recently sent Bithumb a report detailing the findings of its inspection.
Bithumb's application to renew its registration as a virtual asset service provider, filed in late 2024, has also remained pending for an extended period.
"The Korea Exchange's listing review places particular emphasis on legal risks involving a company's beneficial owners and the transparency of its major shareholders' ownership structure," said Ryan Yoon, head of research at Tiger Research. "Without simplifying its complex shareholding arrangements, Bithumb may struggle even to file for preliminary listing approval."
Bithumb said it plans to accelerate preparations for the listing by strengthening its internal control systems, refining its accounting standards and establishing a more transparent governance structure.
"We will systematically fulfill the remaining listing requirements as we work to become a company that earns the deep trust of both the market and investors," a Bithumb official said.
Still, the IPO could have implications extending well beyond Bithumb, according to industry officials.
"Bithumb's stock market debut would provide a key benchmark for how investors value the virtual asset industry once it moves from the regulatory fringes into the mainstream capital market," Yoon said. "A successful listing could trigger a broader re-rating of the virtual asset sector."