- The exchanges are accused of aiding a former lawmaker to complete illegal crypto transactions.
- Also under scrutiny is messaging app Kakao.
Two of the largest cryptocurrency exchanges in South Korea are facing a probe for alleged links with a former lawmaker.
Upbit and Bithumb were raided by the prosecutors Monday for accusations of aiding Kim Nam-kuk, a former Korean legislator from The Democratic Party (DP), to transact 800,000 Wemix tokens, bypassing legislation. Nam-kuk is believed to have used insider information to buy the tokens before transferring them from Bithumb to Upbit.
According to a report shared with a local media house, the politician is believed to have withdrawn the assets at the beginning of the last year before legislation that compelled crypto firms to disclose personal information on any transfer worth more than $758.
Additionally, Nam-kuk, who resigned from The Democratic Party Sunday, is accused of trading digital assets during meetings of the National Assembly’s judiciary committee between May and November 2022.
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Messaging App Kakao Also Under Probe
The search also included the smartphone mobile app Kakao, which Nam-kuk is believed to have used its cryptocurrency wallet, Klip.
In his defence, Nam-kuk said he was ready to comply with the DP’s requirement and sell his Wemix tokens, currently estimated at $660,000.
‘‘I received the recommendation from the party to sell my crypto assets. I would faithfully implement the recommendation. I will transparently disclose data to the investigation team and undergo the inquiry faithfully,” Nam-kuk said.
It is not the first time that South Korea is probing Bithumb. In January, authorities in Seoul raided the exchange’s offices on rumours that a person working at the company had manipulated the price of an undisclosed coin.
