South Korea Intensifies Efforts to Combat Tax Evasion in Cryptocurrency

According to PANews, South Korea's National Tax Service is intensifying its efforts to combat tax evasion, warning that cryptocurrency assets stored in cold wallets may also be subject to seizure. Officials have stated that if there is suspicion of tax evaders hiding crypto assets offline, they will conduct home searches and confiscate hard drives and cold wallet devices. Under the National Tax Collection Act, the tax authority can request account information from local exchanges, freeze accounts, and liquidate assets to cover tax liabilities. While cold wallets provide security for cryptocurrency assets, they can also be used to conceal assets, complicating tax collection efforts. As of June, the number of cryptocurrency investors in South Korea has reached nearly 11 million, marking an increase of almost 800% since 2020. During the same period, trading volume surged from 1 trillion won (approximately $730 million) to 6.4 trillion won (around $4.7 billion). The widespread adoption of cryptocurrencies has led to an increase in tax evasion cases. In 2021, the first operation resulted in the seizure of approximately $50 million in cryptocurrencies, and over the past four years, $108 million has been seized and liquidated.