S. Korean Prosecutors Raid Bithumb and Upbit in Political Investigation

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South Korean prosecutors have raided the offices of two local cryptocurrency exchanges – Bithumb and Upbit – as part of an ongoing investigation into lawyer and politician Kim Nam-kuk’s digital assets transaction records.

Prosecutors Raid Bithumb and Upbit

According to a report by Yonhap News Agency, the team of investigators from the Seoul Southern District Prosecutors Office seized transaction records related to the case after they learned that Nam-kuk operated his e-wallets at the crypto exchanges.

The politician has been under scrutiny over some 800,000 Wemix (WEMIX) coins in his possession. He purchased the assets in 2021 when they were worth roughly 6 billion won ($4.5 million), and suspicions have arisen that he used insider information in buying the tokens.

Nam-kuk is also facing allegations of trading cryptocurrencies while attending meetings of the judiciary committee on digital asset legislation last year. The politician is said to have supported a bill that proposed that lawmakers postpone the 20% capital gains tax on crypto assets from 2023 to 2025.

While the lawmaker is being accused of liquidating his assets before enforcing the “Travel Rule,” he insists that he merely transferred them to another exchange, hence the collection of transaction records from local firms. The Travel Rule requires local exchanges to report transactions that exceed 1 million won (about $748) as authorities combat money laundering.

Kim Nam-kuk Quits His Political Party

Amid the investigation into Nam-kuk, the lawmaker resigned from the Democratic Party (DP) – a political party he joined in February 2020. He said his departure would rid his party members of the burden brought by the crypto investment controversy.

Before his resignation, the DP urged Nam-kuk to sell his 800,000 WEMIX tokens due to the allegations of insider information and failure to adhere to domestic rules while dealing with the tokens.

The politician has affirmed he will fully cooperate with the investigation team, undergo inquiry, and sell the assets worth $700,000 at writing time while he works towards proving his innocence.

Meanwhile, the DP has disclosed that it would thoroughly investigate other party members with experts on crypto assets to ensure irregularities like Nam-kuk’s do not exist.