South Korea’s crypto controversy: This party member escapes expulsion

• Democratic Party member Kim Namkuk once possessed approximately $4.5 million in WEMIX tokens.
• The motion to expel Namkuk for the same required a majority vote to succeed, which was not achieved.

South Korea’s parliamentary ethics subcommittee has made a decision not to expel former Democratic Party member Kim Nam-kuk, following a divisive vote. The motion faced a deadlock as the ruling People Power Party and the Democratic Party evenly divided their votes, resulting in a 3–3 tie that thwarted the motion’s passage.

The subcommittee initially aimed to remove him from office. Scrutiny fell upon Kim’s ownership of Wemix [WEMIX] tokens, as a court ruling led to the delisting of these tokens from major exchanges in 2022. South Korean blockchain game creator Wemade developed the tokens. Local news outlet Yonhap reported the rejection of the expulsion motion on 29 August. It was revealed that Kim once possessed around $4.5 million in WEMIX tokens.

Kim Nam-kuk’s connection to these investments raised serious concerns about conflicts of interest, insider trading, and potential money laundering. His possession of tradable WEMIX tokens prior to their delisting sparked questions about the ethical implications of his actions.

Ethics Subcommittee rejects vote to oust Kim Nam-kuk over WEMIX holdings

This controversy led to the swift advancement of legislation seeking transparency from officials concerning their cryptocurrency holdings. The case spurred a legal effort to mandate cryptocurrency holding disclosure by public officials in South Korea.

In July, South Korea’s Financial Services Commission revealed plans for a new bill mandating cryptocurrency-issuing and holding firms to disclose their crypto assets, beginning in 2024.

South Korea’s Cheongju City announced in mid-August that it intended to confiscate cryptocurrencies from local tax evaders. This initiative required cryptocurrency exchanges such as Upbit and Bithumb to cooperate by sharing information about tax-delinquent individuals.