One of South Korea’s largest funeral mutual-aid operators, Parents Love, put 59.5 billion won in client prepayments into a 2x leveraged ETF linked to BitMine. By the end of 2025, the position’s book value had fallen to just 10.2 billion won, producing a paper loss of 49.3 billion won and wiping out more than 80% of the original amount.
Local reporting said the company bought the T-REX 2X Long BMNR Daily Target ETF, ticker BMNU, during 2024. The fund is managed by Tuttle Capital Management and tracks 200% of BitMine’s daily return. BitMine started in Bitcoin mining and later shifted its business toward an “Ethereum-first” strategy. It is now described as the world’s largest publicly listed holder of ETH, yet its stock has dropped about 40% in 2026, while Ether has fallen about 35% over the same period to around $2,120.
Leveraged exposure magnified the damage
Products built on daily leverage can erode capital quickly in a volatile market, especially when prices move sharply in both directions. Responding to criticism, a spokesperson for Parents Love said the loss was only a short-term unrealized loss caused by swings in global markets and remained within the company’s financial buffer. The criticism has centered on a basic point: the money at stake was prepaid funeral funding from customers, not surplus cash set aside for speculative trading.
Audit of 75 firms found 43% below refundable balances
A wider investigation by Korea Economic Daily reviewed 2025 audit reports from 75 prepaid funeral operators across the country. It found that 32 companies, or 42.7%, held total assets below the amount they are legally supposed to refund to customers. If policyholders or members were to request cancellations at the same time, those firms would likely be unable to return the full balances owed.
The issue points to a regulatory gap. Under current rules in South Korea, prepaid funeral companies are classified as installment prepayment businesses and fall under the Fair Trade Commission rather than financial regulators. The law requires them to retain only 50% of customer prepayments. The rest can be deployed with few practical limits, including into risky assets such as leveraged crypto-linked ETFs. That stands in contrast to insurers, which face stricter solvency requirements.
Loans to affiliates and controlling shareholders also surfaced
The investigation described other cases of questionable use of prepaid funds. Sono Station, the country’s third-largest operator by prepaid balance, held 1.4531 trillion won in such funds and lent 50 billion won to a subsidiary in 2024 for the purchase of shares in low-cost carrier T’way Air. Smaller operator Hanyang Mutual Aid lent 2.2 billion won to its company representative, while Jeju Sunrise Mutual Aid lent 1.6 billion won to its major shareholder.
The most severe case cited was Daero Welfare Business Group. It held 70.6 billion won in prepayments but had total assets of only 40.7 billion won. The company was already failing to meet refunds: in March this year, customers applied for cancellations and did not receive payment, with unpaid amounts reaching 130 million won. The findings show that funds intended to cover future funeral services were exposed not only to market bets, but also to affiliate lending and shareholder-related transfers.