South Korean officials initiated a full examination of all National Assembly MPs’ virtual asset holdings on Tuesday amid a growing cryptocurrency crisis.
Rep. Kim Sung-won of the ruling People Power Party told reporters Tuesday at the National Assembly that the floor leaders of the ruling party and the main opposition Democratic Party of Korea are in talks to have each lawmaker voluntarily disclose their crypto asset holdings immediately despite the lack of mandatory disclosure rules.
Politics shaken by crypto scandal
Kim leads a PPP team that will investigate all politicians’ crypto transactions and seek legal action if they detect dubious activity. Meetings begin Tuesday.
Rep. Yun Chang-hyun, another PPP member, said they will examine on-site inspections of cryptocurrency sector participants such as exchange operators Upbit and Bithumb and gaming business WeMade, which produces cryptocurrency Wemix.
Since last week, belated bipartisan efforts to modify the Public Service Ethics Act to require politicians and public officials to register and disclose their crypto holdings have been ongoing to prevent conflicts of interest.
Rep. Kim Nam-kuk, a former primary opposition legislator, was revealed to have Wemix assets worth over 8 billion won ($5.98 million) since January 2022, raising questions about politicians’ crypto holdings.
Kim moved these funds into other cryptocurrencies before the March 2022 “travel rule” to restrict crypto investors from money laundering took effect. Upbit and Bithumb handled these transactions.
This contradicts Kim’s 2022 statement of 1.26 billion won in assets, implying the prior assets were not revealed during the mandated disclosure. 2023 assets: 1.53 billion won. Kim has denied breaking the law by failing to register his crypto holdings, but he has not disclosed where he got the money.
The attorney-turned-lawmaker used a grey area in Seoul’s crypto asset laws to avoid disclosing his assets.
Kim’s free marketing airdrops of crypto assets raised the stakes. Kim was suspected of being lobbied unlawfully.
Kim acknowledged receiving free crypto assets but denied bribery.
After it was revealed that Kim was one of the senators that supported the 2021 crypto investor tax deferral bill, he has been heavily criticized for this potential conflict of interest. The bill took effect in 2025.
He may have traded cryptocurrencies at a November parliamentary committee meeting.
Kim quit the party Sunday, days after party head Rep. Lee Jae-myung apologized and started an ethics examination of Kim, casting doubt on the legality of the audit.
