Lawmaker’s Crypto Scandal Leads to Upbit, Bithumb Raids

An ongoing controversy concerning a South Korean lawmaker’s cryptocurrency holdings led to his resignation from his political party and raids of cryptocurrency exchanges.

Kim Nam-kuk resigned from the Minjoo party on Sunday, over a week after news broke that Kim owned around $4.5 million in wemix coins in 2021. His holdings had previously been reported on by various news outlets two years ago. 

It’s unknown whether Kim had access to insider information that aided his investments, or if he was given free coins due to his political position.

“Reports to the effect that WeMade illegally supported Wemix or provided internal information related to investments to members of the National Assembly are completely untrue,” Wemix said in a blog post. 

His current holdings, however, are currently unknown.

According to a report from Yonhap News Agency, Korean prosecutors raided Upbit and Bithumb — which is where Kim allegedly has his digital wallets — on Monday in connection with an investigation into Kim. 

The report alleges that transaction records were seized during the raids. 

The scandal has also led to an internal investigation from the ruling political party into Kim after he was also accused of making crypto trades during sessions of parliament. 

During his tenure as a politician, Kim voted in favor of regulatory legislation that would see some gaming money recognized as cryptocurrencies. 

Kim’s crypto scandal comes as South Korea looks to regulate cryptocurrencies. 

In January, National Assembly members were parsing through 17 proposals related to crypto, which ranged from increasing protections for South Korean crypto investors to reserve requirements.

---

Get the news in your inbox. Explore Blockworks newsletters:

• The Breakdown: Decoding crypto and the markets. Daily.
• 0xResearch: Alpha in your inbox. Think like an analyst.
• Empire: Crypto news and analysis to start your day.
• Forward Guidance: The intersection of crypto, macro and policy.
• The Drop: Apps, games, memes and more.
• Lightspeed: All things Solana.
• Supply Shock: Bitcoin, bitcoin, bitcoin.