South Korea’s financial watchdog, the Financial Supervision Service, and the Ministry of Finance have partnered with various financial authorities to crack down on illegal crypto activities.
This approach aims to curb money laundering and fraud related to cryptocurrencies, as recognized by the Government Policy Coordination Office.
The burgeoning cryptocurrency market
The inter-agency crackdown has been sparked by potential illegal activities and speculative investments fueled by a booming crypto market.
Koo Yun-Cheol, head of the Government Policy Coordination Office, noted:
“It is necessary to pay special attention to the occurrence of illegal activities using virtual assets.”
The Financial Services Commission (FSC), the nation’s financial regulator, will need financial institutions to boost their monitoring apparatus on the withdrawal of cryptocurrencies as part of the scrutiny process.
Stop tax evasion
According to the announcement:
“The financial watchdog also plans to closely monitor illegal transfers of virtual assets abroad. The state tax agency will focus on alleged tax evaders hiding cryptocurrency assets. “
In February, the South Korean Ministry of Economy and Finance announced that investors who earned at least 2.5 million won, or approximately US $ 2,260 from cryptocurrency trading, would be subject to a 20% tax from 2022. .
This revelation came after the annual review of the nation’s tax code, which the National Assembly allowed in December. Cryptocurrency taxes have been a hot topic in South Korea since the cryptocurrency tax bill was introduced in the nation’s parliament last year.
Bank of Korea Governor Lee Ju-Yeol has warned citizens against excessive investments in cryptocurrencies based on their high price swings, which could threaten financial stability.
In other news, the South Korean government intends to issue blockchain-enabled COVID-19 “vaccine passports” to immunized citizens in order to reactivate cross-border travel and keep infection risks under control.
Vaccine passports will be linked to a digital certification system powered by blockchain technology to verify a person’s coronavirus vaccination status using a smartphone app from this month.
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