South Korean lawmaker survives ouster over crypto scandal

Kim, who resigned from the Minjoo Party in May to become an independent, has been at the center of a scandal involving his ownership of approximately 800,000 Wemix tokens

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sayan uranan/Shutterstock, modified by Blockworks

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A proposal to remove South Korean legislator Kim Nam-kuk from the National Assembly, due to questionable crypto transactions, was rejected Wednesday.

The divide occurred along party lines, with members from the ruling People Power Party and the main opposition Democratic Party failing to reach a consensus. 

A parliamentary ethics subcommittee split 3-3 on the motion, falling short of the majority required for expulsion, according to local media reports.

Kim, who resigned from the Minjoo Party in May to become an independent, has been at the center of a scandal involving his ownership of approximately 800,000 WEMIX tokens, which were valued at around 6 billion South Korean won ($4.5 million) in 2021. 

The ownership raised suspicions of potential insider trading, further fuelled by reports that Kim actively traded cryptocurrencies during legislative meetings.

The independent’s actions prompted an internal investigation by the Democratic Party in May, which subsequently forced him to liquidate his tokens, Blockworks previously reported.

Days later, Korean officials carried out investigations into local crypto exchanges, including raids on Upbit and Bithumb, where Kim is alleged to have maintained his digital wallets.

It’s alleged Kim may have withdrawn his holdings prior to South Korea’s travel rule, which came into effect in March 2022, mandating the flagging of crypto transfers exceeding 1 million won (approximately $757).

His scandal also led to the passage of the “Kim Nam-kuk Prevention Act,” requiring lawmakers to disclose their digital asset holdings in a bid to boost the transparency of holdings by South Korean lawmakers. 

Additional attention has been drawn to his co-sponsorship of a 2021 bill aimed at delaying cryptocurrency taxation, which came months before he reportedly sold his WEMIX tokens. Kim has publicly refuted these claims and has publicly said he intends to sue media companies for false reporting.


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