Wemade, a South Korean Web3 game developer with a market capitalization of 1.6 trillion Korean won ($1.2 billion), is under investigation by local prosecutors, according to South Korean news reports. 

The investigation centers on allegations of unfair profits through potentially evading regulations that require virtual asset service providers to register with authorities, local news outlet Munhwa reported Thursday.

South Korean regulations mandate registration and reporting by crypto service platforms, except for those not sharing control over user assets by providing private keys. Wemade, which started as a game developer but has transitioned to issuing its own token (WEMIX) and blockchain mainnet, has insisted that the company is not subject to reporting requirements.

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