South Korean gaming company, Wemade, has recently revealed that it owes the country’s tax authorities 53.7 billion won ($41 million) in unpaid taxes. This comes shortly after the company launched a $100-million Web3 fund with Singapore-based Whampoa Group. The unpaid taxes are related to WEMIX tokens issued by Wemade Tree, a subsidiary of Wemade, between January 2019 and 2022. The company stated that the tax debt is scheduled to be paid by February 29, 2024, in accordance with legal procedures. Reports suggest that tax authorities have imposed a penalty of up to 50 billion won ($38 million).
WEMIX tokens were first introduced in 2020 and have seen a significant return of 635% since then. Currently trading at $2.64, the tokens have a diluted market capitalization of $2.5 billion. The tokens operate on an Ethereum Virtual Machine-compatible protocol that powers Wemade’s network of Web3 applications. It is worth noting that South Korea had previously banned initial coin offerings in 2017 but is now considering reversing the ban and implementing a 20% tax on crypto transaction profits.
In December 2023, Wemade launched a $100-million Web3 fund in partnership with Whampoa Group. The aim of this fund is to invest in digital asset initiatives in the Middle East. As part of the collaboration, Whampoa Digital will be an ecosystem partner to Wemade’s Wemix Play Center in the Dubai International Financial Centre Innovation Hub, with fund capital supporting Wemix Play developers.
In conclusion, Wemade’s disclosure of its unpaid taxes highlights a significant financial liability for the company. However, its recent partnership with Whampoa Group and the launch of the Web3 fund show its commitment to expanding its presence in the digital asset space. The future of Wemade and its WEMIX tokens will likely be influenced by the outcome of its tax debt resolution and the potential changes in South Korea’s regulations on cryptocurrency transactions.