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South Korea’s Crackdown on Cryptocurrencies

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With the world moving towards a fast-paced adoption of cryptocurrencies, regulators are facing a lot of problems trying to navigate the tricky waters of the crypto sphere. Throughout the world, governments have been vocal about the riskiness of cryptocurrency investment whereas others have been worried about the susceptibility of cryptocurrencies to criminal activities. Cryptocurrencies are notoriously known to be hotbeds for illegal activities especially money laundering and tax evasion because of the lack of regulation in the industry.

Asia have had a love-hate relationship with cryptocurrencies but amidst the recent rise in crypto adoption, regulators have become increasingly strict. South Korean regulatory authorities have joined hands to crackdown on the rampant illegal activities going on in the cryptocurrency market. The Ministry of Economy and Finance, the Ministry of Justice, the Financial Services Commission, and the National Police Agency have, together, launched a plan to eradicate the problems brought by cryptocurrencies. With every agency playing its role, there has been an increase in monitoring of transactions – in the country as well as across border.

The crackdown has come to fruition as the city of Seoul has announced the seizure of $22 million worth of cryptocurrencies on account of tax evasion from individuals and companies. The city’s tax authority, National Tax Service, had identified 1,566 individuals and company executives with overdue taxes. $22 million worth of cryptocurrencies were seized from three different cryptocurrency exchanges from 676 of the 1,566 individuals.

Out of the total tax delinquents, 118 of them have remitted $1 million to the government. The cryptocurrency holders have also appealed to the government to not liquidate the cryptocurrencies as their value is expected to increase.

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