South Korean legislator Kim Nam-kuk resigns over allegations of improper crypto dealings

Photograph of Kim Nam-kukKim Nam-kuk (attribution)
South Korean lawmaker Kim Nam-kuk has resigned over a cryptocurrency scandal. On May 8, 2023, The Korea Times reported that Kim cashed out around 800,000 Wemix tokens priced at around ₩6 billion (~$4.5 million) in previously unreported cryptocurrency assets shortly before Korea's March 2022 imposition of the travel rule, which requires disclosures around the identities of those involved in large crypto transactions. Kim denied the allegations, claiming he had simply moved the assets to another exchange. Other legislators and citizens expressed shock at Kim's apparent crypto wealth, as he had portrayed himself as someone who was not affluent.

Other concerns arose regarding the discovery of the assets. Some were worried about possible conflicts of interest, particularly in relation to Kim's 2021 proposal of a bill that would delay taxation of crypto profits. Others were worried about the source of the funds used by Kim for crypto trading; Kim claims he did not receive money from anyone to use for trading, and obtained the money through the sale of stocks.

On May 10, the Democratic Party recommended Kim sell his crypto holdings, and launched an investigation. Kim said later that day that he would perform the sales, and "transparently disclose data to the investigation team and undergo the inquiry faithfully".

On May 14, Kim resigned from the Democratic Party "for a while", continuing to deny the allegations but expressing wishes to not burden the party and its members over the controversy.

The subsequent day, Korean authorities raided the offices of Korean crypto exchanges Bithumb and Upbit in connection to the scandal, seeking transaction records and other information. Kim was reported to use those services for his crypto wallets.