South Korean gaming company Wemade, recognized for its significant ventures in the Web3 space, recently faced a substantial tax obligation. The company, which just last month announced a $100 million Web3 fund in partnership with the Singapore-based Whampoa Group, disclosed that it owes 53.7 billion won (approximately $41 million) in taxes. This debt, amounting to about 10% of the firm’s equity, is related to the issuance of WEMIX tokens by its subsidiary, Wemade Tree, from January 2019 through 2022.
Wemade’s Tax Obligation Details
The tax debt was highlighted in a January 3 filing with Kosdaq, where Wemade clarified its intention to comply with legal procedures, planning to settle the amount by February 29, 2024. Reports from local media suggest that tax authorities have also imposed a penalty that could be as high as 50 billion won ($38 million).
The WEMIX Token
Launched in 2020, the WEMIX token has seen a return of 635% since its inception. It currently trades at around $2.64, with a diluted market cap of $2.5 billion. WEMIX operates on an Ethereum Virtual Machine-compatible protocol and is integral to Wemade’s network of Web3 applications.
South Korea’s Regulatory Environment
South Korea’s regulatory stance on cryptocurrency has been evolving. The country initially banned initial coin offerings (ICOs) in 2017 but is currently reconsidering this decision. There’s a proposal to instead implement a 20% tax on profits from crypto transactions.
Wemade’s Web3 Fund with Whampoa Group
Wemade’s recent partnership with Whampoa Group marks a significant move in the Web3 domain. The $100-million fund, established on December 22, 2023, aims to invest in digital asset initiatives, particularly in the Middle East. Whampoa Digital will collaborate as an ecosystem partner for Wemade’s Wemix Play Center in Dubai’s International Financial Centre Innovation Hub. The fund is expected to support developers for Wemix Play, reinforcing Wemade’s commitment to expanding its Web3 influence.