Bhutan Launches Blockchain-Based National ID System

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 If Kim had directed all the money withdrawn from the LG Display shares to WEMIX tokens, it is unclear where the additional $774,000 in his account came from.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.

Hong Kong securities group proposes ICOs as growth opportunityKey stakeholders in Hong Kong’s financial world are contemplating a transformative shift in the Chinese autonomous territory’s digital asset strategy that concerns furthering initial coin offerings (ICOs).Photo by Qinyi Lian on UnsplashRoom for improvementIn a recent letter signed by Chen Zhihua, President of the Hong Kong Securities and Futures Professionals Association (HKSFPA) and published to the HKSFPA website on Wednesday, the introduction of an ICO mechanism as a potential catalyst for the city’s economic revival has been proposed.The letter, which provided the HKSFPA’s “opinions on the 2024–2025 budget,” included the ICO suggestion as recommendation №10 on a list of various proposals. The suggestion comes amid ongoing efforts to navigate the economic challenges posed by the pandemic. Zhihua acknowledges the developmental approach taken by Hong Kong Chief Executive John Lee where financial sector strategy is concerned, but emphasizes the industry group’s belief in the room for improvement that exists to stimulate Hong Kong’s financial sector further.Formalizing ICOsFormalizing ICOs in Hong Kong could establish a supportive environment for crypto startups and investors seeking regulated and secure opportunities. The proposal aligns with a broader call for government engagement in economic recovery and policy-making, emphasizing a collaborative approach toward the crypto sector. This inclusive stance signals a forward-thinking perspective that could lead to more supportive policies and frameworks, fostering a conducive environment for crypto innovation and growth.Reflecting on the history of ICOs, the letter acknowledges the fundraising method’s evolution since the attention garnered by the Mastercoin ICO in 2013 and Ethereum’s significant milestone in 2014. The ICO boom of 2017 saw projects like EOS and Tezos raising substantial funds, accompanied by both enthusiasm for fundraising ease and concerns about investor protection due to minimal regulation.Fraud concernsWhile the ICO boom faced regulatory scrutiny and witnessed instances of fraud and scams, a progressive approach by financial regions such as Hong Kong could reshape the global perception of ICOs. The letter suggests that, under favorable terms, ICOs could play a pivotal role in revitalizing the digital asset landscape.Zhihua underscores the importance of addressing potential challenges by urgently reviewing and enhancing anti-money laundering (AML) and counter-terrorist financing legislation. This cautious approach aims to ensure that ICOs in Hong Kong adhere to established frameworks, avoiding the pitfalls associated with unregulated fundraising.While that’s the HKSFPA’s position, the initial flurry of ICOs a number of years ago involved many projects proposed by scammers and fraudsters. At the time, the Hong Kong Securities and Futures Commission (SFC) recognized the development as “downright fraud” and put pressure on exchanges to delist many tokens.One other related element that the letter proposes is in integrating environmental, social and governance (ESG) and Islamic finance elements into investment immigration policies. This forward-thinking approach reflects a growing awareness of ethical and sustainable investment practices that could potentially position Hong Kong to set new standards for responsible investment.

RaonSecure Partners with Korean Savings Banks to Build Mobile ID Verification SystemRaonSecure, a South Korean tech security firm and blockchain solutions developer, announced yesterday its partnership with the Korea Federation of Savings Banks (KFSB) to build a system that verifies customers’ identities through mobile identification cards, according to local news outlet Financial News.Photo by Brett Jordan on UnsplashImproving customer convenienceThe KFSB has undertaken the establishment of a mobile ID verification system with the goal of improving customer convenience. This system enables mobile ID cardholders to easily verify their identities during the know-your-customer (KYC) procedures of savings banks, whether they are conducted remotely or in-person. In pursuit of this objective, RaonSecure was chosen through a selection process that sought out a company with experience in constructing mobile IDs.Blockchain-powered DID solutionRaonSecure CEO Lee Soon-hyung said the company has demonstrated its technological prowess by providing cutting-edge services based on its blockchain-powered decentralized identity (DID) platform, OmniOne. These offerings include an application tailored for civil servant IDs, along with an app specially crafted to support citizens who entered or completed military service.Under this agreement, RaonSecure will develop a system designed to ensure both convenience and security in verifying mobile IDs across the integrated computer network of KFSB’s member banks. The company has future plans to extend its services to individual banks, aiming for wider implementation and utilization.During the initial phase of the service rollout, verification will be limited to driver’s licenses. However, RaonSecure’s overarching objective is to establish a dynamic and adaptable system capable of accommodating a broader array of identification documents, such as resident registration cards, in the future.Most Korean commercial banks have already accepted mobile IDs for their identification processes. Other financial institutions, including insurance companies and card companies, are also embracing this trend and introducing similar services. This collective shift is anticipated to expedite the growth and expansion of the industry.