South Korean Crypto Exchange Declares Bankruptcy Citing Embezzlement

South Korean cryptocurrency exchange Coinbin has declared bankruptcy after suffering millions of dollars in losses, in part due to claimed embezzlement.

Specifically, it said regulators' suspension of its ability to issue virtual accounts to users was part of the cause, as well as increased operating expenses and liabilities from its collapsed subsidiary exchange Youbit.

A report from Business Korea on Friday indicated that Coinbin suffered estimated losses of 29.3 billion won.

According to the notice, Coinbin halted all crypto and cash withdrawals at 3:00 pm on Wednesday, and asked users to not deposit any more funds in their accounts.

The exchange further cited "Corporate executive moral hazard" as one of the reasons for its bankruptcy.

Coinbin acquired crypto exchange Youbit in 2017, according to Business Korea.

Coinbin CEO Park Chan-kyu told the news source that Youbit's former CEO had "Committed dereliction of duty and embezzled company funds."

The exchange said at the time that it had lost around 17 percent of its total assets in the breach.

Youbit, previously known as Yapizon, suffered its first hack last April - one South Korean officials believed was conducted with the support of neighboring North Korea.

Last month, South Korea's Ministry of Science and ICT, the Korea Internet & Security Agency and the Ministry of Economy and Finance reported that they had inspected 21 crypto exchanges and only a third passed a security audit.