The South Korean company Wemade, a developer of Web3 games with a market capitalization of 1.6 trillion Korean won (about 1.2 billion dollars), is facing an investigation by the local prosecutor's office. The reason for the investigation is accusations of gaining unfair profits by evading legislative requirements for the registration of virtual asset providers.

According to the local publication Munhwa, South Korean legislation requires crypto platforms to register and provide reporting, except in cases where they do not control user assets through private keys. Wemade, originally a game developer that has moved to issuing its own WEMIX tokens and blockchain network, claims it does not fall under these requirements.

The focus of the prosecutor's office is on the decentralized exchange PNIX, associated with Wemade, and the digital asset storage system Play Wallet, specifically their ability to hide private keys from users. The investigation aims to determine whether PNIX and Play Wallet violate the law by avoiding the reporting obligations required for platforms that do not give users control over private keys.

The Korean Financial Intelligence Unit has also started its own investigation into similar complaints against Wemade. In response to the accusations, the Wemade WEMIX team stated that PNIX DEX and Play Wallet are not subject to regulatory requirements, as Play Wallet is a decentralized service that does not control personal keys or user assets, and PNIX simply provides a platform for decentralized trading, where assets awaiting transactions are stored in smart contracts outside the operator's control.