South Korean authorities raid Upbit, Bithumb crypto exchanges after political scandal
Prosecutors in South Korea raided the offices of two local cryptocurrency exchanges due to investigations surrounding the digital assets of lawmaker Kim Nam-kuk.
According to a report from the South Korean news agency Yonhap, a team of prosecutors from the Seoul Southern District Prosecutors Office raided cryptocurrency exchanges Upbit and Bithumb for transaction records and other materials.
Kim is said to operate his digital asset wallets on Upbit and Bithumb.
The raid from authorities immediately followed Kim’s resignation from his political party on May 14. His departure is tied to several allegations against him due to allegedly suspicious crypto dealings while he worked on digital asset legislation in May and November of 2022.
According to a Facebook post from the former lawmaker, he did not want to “burden” his fellow party members with the controversy surrounding his crypto dealings. In the same post, he also said that the accusative media reports had “false facts” and that he would “reveal the truth.”
A May 8 report from the Korea Times reported that Kim liquidated over $4 million in crypto before the Financial Action Task Force enforced the “Travel Rule.” Kim is said to have backed a bill that would defer the 20% capital gains tax on cryptocurrencies from 2023 to 2025.
Kim reportedly claimed to have not cashed out his digital assets but rather transferred them to another exchange. The lawmaker said he was not obliged to report such activity.
The South Korean politician is said to have owned approximately 800,000 Wemix coins in 2021 ($4.5 million), according to reports from Yonhap.
Bithumb, one of the exchanges in which Kim allegedly had his funds, has been under close watch by local regulators in recent months.
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