Bithumb ordered to pay outage damages to investors by South Korean court

The ongoing saga of the South Korean cryptocurrency exchange Bithumb continues, this time with the local courts ruling.

On January 13, the South Korean Supreme Court finalized its ruling that the exchange must pay damages to investors for a 1.5-hour service interruption on November 12, 2017. According to a local news source, the damages are equivalent to $ 202, 400 - or 251.4 million in won regional currency.

Initially, one district ruled against the investors, though it was later overturned. The final Supreme Court ruling ordered the payment of damages ranging from $6 to around $6,400 to the 132 investors involved.

The court's final ruling stated that:

"The burden or cost of technological failures must be borne by the service operator, not [the] service users who pay a fee for the service".

Bithumb is the largest cryptocurrency exchange in the country. The temporary outage came after the average number of orders per hour suddenly doubled and transaction flows became bottlenecked.

Investors seeking compensation claimed that as Bitcoin Cash (BCH) and Ethereum Classic (ETC) had significant drops during the outage.

Related: South Korean court freezes $92 million in assets related to Terra tokens

Prior to this ruling, Bithumb has been under close surveillance by local authorities. After investigations into the former president of the exchange and sudden death from one of the largest shareholders after allegations of embezzlement, Bithumb is now under investigation by regulators.

research is a “special tax investigation” by the country's National Tax Service (NTS). Authorities are exploring possibilities for tax evasion and raided Bithumb's headquarters on January 10.

Regulators in South Korea appear to be cracking down on the local crypto scene. In November 2022, the country began research on cryptocurrency exchanges to list native tokens.

Following the FTX scandal, the South Korean city of Busan announced that it is dbreaking global crypto exchanges of its plans to incorporate third-party digital exchanges.