Japanese cabinet approves crypto tax reform

A Korean Lawmaker’s Crypto Holdings Worth $4.5M Spark ControversySouth Korean lawmaker Kim Nam-kuk, a member of the opposition party Democratic Party of Korea (DPK), has recently come under scrutiny due to his reported possession of 800,000 WEMIX tokens from January to February last year, as reported by the Maeil Business Newspaper. These tokens were worth approximately 6 billion KRW or $4.5 million at the time. While Korean lawmakers are obligated to disclose their wealth, virtual assets are an exception. The disclosure of Kim’s ownership of these tokens has ignited controversy, as it unveiled a wealth magnitude significantly greater than previously understood.Photo by Karolina Grabowska on PexelsTravel Rule regulationA central issue in the unfolding dispute is the source of Kim’s investment in the WEMIX tokens. It has been reported that he purchased a significant amount of these tokens between January and February last year and withdrew the entire sum between February and March before the crypto exchange implemented measures to comply with the Travel Rule regulation. This rule requires that financial authorities be informed of transactions over 10 million KRW ($7,500). After the crypto exchange reported the transactions to the Financial Intelligence Unit of the Financial Services Commission, the government agency requested a warrant to search Kim’s account due to the transactions’ abnormality. However, the court dismissed the request.Jeonse deposit to LG Display sharesIn response to the controversy, Kim took to a YouTube channel on Tuesday to explain his WEMIX token investments. He stated that he had retrieved 600 million KRW ($450,000) after his jeonse contract expired and used the money to purchase LG Display shares. Jeonse a housing rental system in Korea where tenants put up a lump-sum refundable deposit on a rental space for a two-year stay. Kim claims that these LG Display shares later rose in value to 985.7 million KRW ($744,000) in January 2021 and that he used this sum to purchase the tokens.Account balance and WEMIX tokensDespite his explanation, there are still questions surrounding Kim’s sudden increase in his bank account balance. His account balance reportedly increased from 100 million KRW ($76,000) at the end of 2020 to 1.12 billion KRW ($850,000) by the end of 2021, which raised suspicions. If Kim had directed all the money withdrawn from the LG Display shares to WEMIX tokens, it is unclear where the additional $774,000 in his account came from. Kim has reportedly explained to his party’s leadership that he retrieved the principal amount of his investment due to the increase in the WEMIX token price. However, this explanation has not satisfied some critics.Insufficient explanationIn an attempt to address these concerns, Kim shared part of his bank transaction records on Monday. However, this disclosure has fallen short of addressing all the questions that have been raised, such as the precise amount invested in the tokens and their purchase prices. There is still significant public scrutiny and skepticism surrounding Kim’s explanation for his crypto holdings, and it remains to be seen if further disclosures will be made.Kim apologized to the Korean public via Facebook for any disappointment caused, especially amid challenging economic conditions. However, he denied accusations of using undisclosed information or unlawfully acquiring wealth. Kim maintained that all transactions were transparently made using only his own wallets through his real-name bank accounts.Potential insider trading and conflict of interestNevertheless, the public’s acceptance of his explanation is yet to be seen, as questions about his $4.5 million virtual assets persist, particularly given his reported total wealth of around $1.1 million. There are concerns surrounding the possibility of insider trading. Furthermore, Kim’s participation in proposing a bill to defer tax implementation on digital assets has triggered suspicions of a potential conflict of interest.Call for an impartial third partyRecent updates indicate that the prosecution is considering requesting a warrant against Kim in relation to the controversy surrounding his crypto holdings. The Anti-Corruption and Civil Rights Commission is also examining if his participation in proposing the bill constitutes a conflict of interest. It is evident that an impartial third party will need to investigate and analyze all relevant information to resolve this dispute. Until a thorough and unbiased investigation takes place, the public’s concerns and questions are likely to continue.

The Klaytn Foundation and Finschia Foundation have jointly submitted a governance proposal to launch a new mainnet created by merging their respective blockchain ecosystems. The proposals have been submitted for open discussion, with voting scheduled for Jan. 26 to Feb. 2, according to an official announcement on Wednesday (KST).Photo by Shubham's Web3 on UnsplashThe main objective of this initiative is to create Asia’s largest Web3 ecosystem by combining key features of both blockchains. To do so, the two foundations plan to share their technologies, services and business networks and fortify connections between their partners like their mother companies Kakao and LINE, who have contributed to their development and expansion. “We are excited to be taking the first step toward unlocking the enormous synergy of merging the public blockchains started by Kakao and LINE, which are both leading IT companies in Asia,” the two foundations said. “We will give our best to make this merge an opportunity to innovate and lead the Asian blockchain industry in both technology and adoption.” An unprecedented mainnet ecosystemThe merger will bring together Klaytn and Finschia’s networks in different Asian countries, like Klaytn’s leverage in South Korea, Singapore and Vietnam, and Finschia’s service network in Japan, Taiwan, Thailand and Abu Dhabi. Once the combined ecosystem is launched, it will offer over 420 decentralized apps (dApps) and services, 45 governance partners and some 450 Web3 resources, becoming a mammoth Web3 network capable of swaying the trajectory of the Asian market. In addition, the blockchain will be connected with both Kakao and LINE messengers – two well-known messenger apps in Asia – opening up access to a vast continental user base of over 250 million people. The integration is also expected to catalyze the creation of new Web3 infrastructure in Asia, boosting scalability and liquidity. Future business plansThe joint foundation is specifically set to undertake projects in areas like RWA tokenization, GameFi, DeFi verticals, messenger-based Web3 services and digital commerce through partnerships with Japanese, South Korean and Southeast Asian firms. By leveraging its access to Kakaotalk and LINE users, the new public blockchain has the potential to be a springboard for IT and entertainment enterprises in Asia. Improved tokenomicsWhat may especially interest shareholders and users alike is a new native token that will be issued on the merged network, replacing the foundations’ respective tokens KLAY and FNSA. Holders of KLAY and FNSA will be able to swap their tokens for the new one. The proposed tokenomics system for the new token emphasizes sustainable value creation. This includes a lower base inflation rate and a 3-layer burning model created to encourage deflation as activity on the network increases. 24% of newly issued tokens will also be burned immediately as a trustworthy Zero Reserve Tokenomics measure. This will all be supported via an ecosystem fund and infrastructure fund that are constantly replenished via block rewards, rather than relying on reserves.Enhanced governance and interoperabilityKlaytn and Finschia also plan to bring together their experiences in practicing good governance to build a  permissionless node validation system to put the spotlight on users and the community, promoting transparency, trust and openness. To support the seamless migration and interoperability of existing dApps and services on Klaytn and Finschia, the merged chain will support the smart contract platforms EVM and CosmWasm. Ethereum and Cosmos builders will thus be able to gain access to the network. The foundations are set to host an upcoming event called Klaytn Community Town Hall on Friday to introduce the proposal and facilitate open dialogue and feedback.

Finger Labs to leverage Web3 services for Dream Ladders’ college entrance briefingFinger Labs, a subsidiary of digital marketing company FSN, announced on Tuesday (local time) that it is set to introduce its Web3 services, Xclusive and Favorlet, at an informational college admissions briefing hosted by Dream Ladders, a blockchain subsidiary of educational and career services provider Jinhak.Photo by Unseen Studio on UnsplashXclusive is Finger Labs’ Web3 content distribution hub that uses blockchain technology to connect content creators and consumers, facilitating the distribution of various content like movies and performances and the creation of profitable business models. Favorlet, on the other hand, is an NFT wallet that allows users to view, manage and store their NFTs safely in one place.Innovative ticketingThe upcoming briefing, organized by Dream Ladders’ EDUM project, is set to share insights regarding college entrance exams and applications. Attendees will be able to submit questions in advance and receive exclusive benefits. It is scheduled for Dec. 22 to 23, hosting 50 select individuals each day.Tickets for the event will be issued and sold as NFTs, which are available for purchase on Xclusive until Dec. 21. Attendees can purchase the tickets and store them in their Favorlet wallets, which will allow them to easily verify their tickets on-site at the briefing. This ticketing process will serve to show users the convenience that Web3 technology offers.“Contributing our Web3 services to this opportunity offers promising outlooks,” said Kim Dong-hoon, CEO of Finger Labs.Showcasing Web3 solutionsFinger Labs has previously tailored solutions for major corporations like SK Planet, Lotte Homeshopping and SK Networks. In particular, the company also introduced Xclusive and Favorlet at this year’s Blockchain Grand Week — a large-scale blockchain event hosted by the Ministry of Science and ICT and jointly organized by the National IT Industry Promotion Agency (NIPA), the Korea Internet and Security Agency (KISA) and the Institute of Information and Communications Technology Planning and Evaluation (IITP).