South Korean Party Seeks Early Enforcement of Bill on Crypto Asset Declaration

South Korea’s ruling party, the People’s Power Party is seeking to move up the enforcement date for December to a new bill that will require lawmakers in the country to declare their cryptocurrency holdings. Application of the new bill is expected to come into effect in the next one or two months, Yun Jae-ok, the floor leader of the party, told reporters on Tuesday.

According to local media Yonap, the revision to South Korea’s Public Service Ethics Act was scaled through a parliamentary sub-committee on Monday and is now scheduled for voting on Friday. However, Yun told reporters that the planned enforcement of the law in December is too distant. Therefore, the lawmaker said it has instructed the Public Administration Committee to put forward a modified version, the outlet reported.

"Given the current high level of public interest, especially regarding lawmakers, it's not appropriate to enforce the law six months later after the promulgation," Yonap quoted Yun as saying.

South Korean Lawmaker Faces Crypto Scandal

The new bill primarily aims to address the growing demand for transparency on the digital asset holdings of lawmakers, which is a trend that has intensified following the ongoing investigation into the crypto holdings of Kim Nam-kuk, a former opposition lawmaker who is now independent.

Kim is currently facing scrutiny after allegations emerged that he possessed approximately 800,000 Wemix coins in 2021, valued at around 6 billion won (US$4.5 million) at that time. In addition, the lawmaker is alleged to have hidden this information from his asset declaration as current laws do not mandate it.

Furthermore, it is being alleged that Kim withdrew the crypto assets before South Korea implemented the global anti-money laundering body Financial Action Task Force's (FAFT) travel rule in March last year. The rule demands that crypto exchanges record and report personal data on transactions that exceed a certain threshold.

New Concerns

Meanwhile, Yonhap reported that Yun raised new concerns about the lawmaker's crypto activities. According to the outlet, the legislator said Kim might have withdrawn 250 million won worth of coins between February and March 2022 before the country’s presidential election.

Furthermore, the lawmaker believes that the amount far exceeds the 4.4 million won Kim previously acknowledged to have cashed out during that period. Additionally, Yun expressed suspicions that Kim's involvement in cryptocurrency transactions may have been linked to money laundering activities.

As the investigation into Kim’s alleged crypto transfers continues, three local crypto exchanges have been raided and the ruling party recently sent a team to Wemix issuer with the hope of shedding light on the case.

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