<Chairman Song Chi-hyung of Doonamu and CEO Lee Seok-woo>
Major cryptocurrency exchanges in South Korea are facing growing public backlash after it was revealed that they handed out tens of billions of won in bonuses and dividends to executives and employees last year amid record-breaking profits. What sparked the most controversy was the revelation that even former executives convicted of financial misconduct received massive compensation.
◇ Bithumb Paid 4.7 Billion Won to Convicted Former CEO
One of the most criticized cases involves Bithumb, which reportedly paid a total of 4.7 billion won (approx. $3.5 million USD) last year to its former CEO Lee Sang-jun, who is currently serving a two-year prison sentence for accepting bribes in exchange for listing specific cryptocurrencies on the exchange. His compensation included a 2 billion won bonus, 2.23 billion won in retirement pay, and 466 million won in salary.
Lee was found guilty in late 2023 for receiving luxury gifts and bribes, including 3 billion won in cash, in exchange for listing a specific coin on the exchange in 2021. Although he was acquitted on some charges, the court acknowledged partial guilt and issued a prison sentence along with a fine.
Bithumb explained that Lee’s payout reflected his “contributions to the exchange’s growth and regulatory transition,” stating that his management performance warranted compensation despite his legal troubles.
Additionally, Bithumb paid 1 billion won in bonuses to Lee Jung-hoon, the company’s de facto owner and current head of its service R&D division.
◇ Dunamu (Upbit) Founder Received Over 110 Billion Won
Upbit’s operator Dunamu also made headlines for its massive executive payouts. Its largest shareholder, Chairman Song Chi-hyung, received over 110 billion won in total compensation last year, including 6.2 billion won in salary and bonuses, and 104.2 billion won in dividends. This windfall came after Dunamu nearly quadrupled its dividend per share compared to the previous year.
Vice Chairman Kim Hyung-nyeon received around 57.7 billion won, while CEO Lee Seok-woo earned 2.16 billion won in total compensation.
Dunamu’s average employee salary also soared to 199 million won, a 71% increase year-over-year, far exceeding even top-tier financial institutions. Bithumb employees also saw their average salary rise to 116 million won.
◇ Performance Rewards or Ethical Overreach?
Both exchanges recorded stellar performance in 2023. Dunamu posted an operating profit of 1.19 trillion won and a net profit of 984 billion won. Bithumb reversed its previous year’s losses, reporting 130.7 billion won in operating profit and 161.8 billion won in net profit.
However, questions remain about the morality of distributing astronomical rewards — particularly to individuals under legal investigation or convicted of financial crimes. Dunamu, for instance, is currently under investigation by South Korea’s National Tax Service over alleged offshore tax evasion and questionable legal expenses, which reportedly reached over 10 billion won.
Industry experts warn that such excessive compensation practices, especially when involving disgraced figures, could undermine public trust in the crypto industry. While companies defend these as performance-based rewards, critics argue that greater accountability and governance are urgently needed.
