South Korean Lawmaker Resigns from His Party Amidst Controversy Regarding Crypto Dealing

According to government sources, the lawmaker sold around $4 million in terms of cryptocurrency before the country enforced the “Travel Rule” following the guidelines set by the FATF.

Kim Nam-kuk announced to bid farewell to the Democratic Party over allegations of crypto dealing while working and drafting the legislation for digital assets.

While the politician did part ways with the political party, he said he would continue to fight independently to prove he is not guilty.

Relief for Party Members

According to the South Korean lawmaker, the departure from the party would allow his fellow members to focus on the legislation. He said that the party member would be relieved rather than getting burdened by this controversy.

Furthermore, he believes that leaving the party will no longer impact the party’s standing on digital assets at such a crucial time. Even though Kim left the party, he vowed to give his continuous support to the political faction.

In addition to that, the politician also said that he would continue to work independently to shed light on the truth as an independent legislator. “I will continue my efforts in order to bring the truth in front of the people and to end these unfair political offenses,” he said.

The politician also criticized the media for not handling the situation properly. He added how the media reported his crypto dealing by stating the reports that weren’t based on any facts and figures. Kim pledged to confront them and turn towards legal action if necessary.

Allegations against the Lawmaker

According to local media reports, the lawmaker was accused of liquidating crypto assets that are worth around $4 million. This was done right before the country enforced the Travel Rule” from the FATF in March 2023.

The matter is still under investigation as authorities continue to look at the complete facts and figures. South Korea has recently joined the queue of countries with the US, Canada, and others, who are tightening their regulations on crypto firms.

The country’s central bank is constantly speeding up its efforts to keep an eye on the crypto industry in the country. On 24th April, the Bank of Korea was given the authority to investigate any transactions related to crypto-business.

As a result, it gives the bank power to request any transaction data from local crypto firms, operators, etc. In other news, there is also ongoing research about the central bank digital currency (CBDC) to uncover the offline payment options in the country.

Samsung Electronics is collaborating with the central bank to conduct research on the offline features and capabilities of the CBDC.

South Korea’s Efforts to Regulate the Crypto Market

Earlier in April 2023, South Korea planned on passing legislation that was able to clear the first hurdle. South Korean lawmakers give the go-ahead for the bill to complete the first phase review of the proposed regulations.

With these regulations, the country’s Financial Services Commission now has the authority to launch a probe against and keep an eye on the financial transactions involving digital assets, including cryptocurrency.

Moreover, the bill also came with various stipulations about how to monitor the sale, storage, and trade of crypto assets. It also has a huge emphasis on customer data protection and compliance reporting.

There are other phases that the bill has to go through before it can officially become law. If passed, then this bill would be the most be most sweeping part of South Korea’s cryptocurrency legislation to date.

It would mean that exchanges and other businesses in the industry would have to keep separate internal holdings from user assets.