Kim Nam-guk, a former South Korean lawmaker from the Democratic Party, is under legal scrutiny for allegedly concealing substantial cryptocurrency holdings in his 2021 and 2022 asset declarations.

He is accused of omitting millions in crypto profits and transferring assets to bank accounts.

Hidden Crypto Profits

A local news outlet, Donga, prosecutors have requested a six-month prison sentence for Kim, claiming he concealed 9.9 billion won, worth approximately $6.8 million, in crypto assets. The accusations include deliberate omissions of key financial details, such as crypto profits of 1.2 billion won in 2021 and 990 million won in 2022, valued at $835,000 and $689,000, respectively.

To cover up these discrepancies, Kim is accused of transferring some of his crypto holdings into regular bank accounts, making it appear as though he had converted his digital assets into fiat currency. His case shed light on the ongoing debate around South Korea’s crypto regulations, especially as the country moves toward implementing a long-debated crypto tax.

This tax, set to take effect in January 2025, was originally scheduled for 2022 but faced delays due to political disagreements. Under the new policy, the tax exemption threshold for crypto gains will increase significantly, reducing the number of affected investors. Kim’s case is particularly notable given his vocal criticism of his party’s stance on crypto taxation, further complicating the issue.

The case comes amid other high-profile crypto-related legal actions in South Korea, including the recent sentencing of a former bank employee who embezzled millions for failed crypto investments. Kim’s trial is expected to set a key precedent for future legal actions and crypto taxation policies in the country.

Meanwhile, South Korea’s financial watchdog, the Financial Supervisory Service (FSS), has taken a restrictive stance toward crypto-related inves