Damage to investors is growing due to the temporary suspension of access to major virtual currency exchanges coupled with sharp fluctuations in virtual currency prices. Investors are filing lawsuits against virtual currency exchanges.
On November 12, virtual currency prices showed sharp fluctuations. Bitcoin prices ranged from 6.5 million won (US$5,850) to 7.99 million won (US$7,190) and Bitcoin Cash also moved between 1.5 million won (US$1,350) and 2.9 million won (US$2,610). In particular, when Bitcoin Cash hit 2,839,800 won (US$2,550), an all-time high, (based on the Bithumb price) at 3:40 pm on November 12, Bithumb's virtual currency trade service was temporarily suspended due to overheating. At about 5:40 pm when the server recovered, the price of 1Bitcoin Cash already plunged by 1,160,000 won (US$1,040) to 1,680,000 won (US$1,510).
Bithumb, which boasts of the highest transaction volume among virtual currency exchanges, suspended all Bithumb services because the server connection was not available around 4 pm on November 12. At the same time, Korbit also posted a notice saying that the site was under repair due to technical problems. The Bithumb Exchange resumed access at 5:45 pm.
As of 9:30 am on December 13, the price of Bitcoin stood at 6,927,000 won (US$6,230), a drop of 220,000 won (US$190) from the previous day while Bitcoin Cash at 1,160,000 won (US$1.040), a drop of about 100,000 won (US$90).
While the Bitcoin Cash price hits record highs, servers of Bithumb, the number-one virtual currency exchange in Korea, were paralyzed for about two hours, damaging investors. This is provoking controversy about the stability of virtual money exchanges again. It is pointed out that government authorities need to control and supervise exchanges. Some victims are going around in group such as petitioning the Blue House (Korea’s White House) to launch an investigation into Bithumb headquarters.
Currently, there are no regulations to punish virtual currency exchanges for problems such as server breakdowns. Virtual currency exchanges are registered as communication vendors such as online shopping malls and are subject to the Consumer Protection Act on Electronic Commerce and Others. The amount of daily virtual currency transactions at Bithumb already exceeded that of the KOSDAQ in August this year, but Bithumb does not need to have security or server stability at the financial company level.