South Korea has taken a significant step towards strengthening its monitoring of crypto transactions by agreeing to share information with 48 states under the OECD’s Crypto-Asset Reporting Framework.
The government of South Korea has announced plans to start sharing information on local and foreign investors trading cryptocurrency on platforms such as Upbit and Bithumb. Data collection will begin next year, with the official enactment of the system scheduled for early 2027.
As part of the framework, crypto exchanges in South Korea will be required to report transaction history and personal information of investors to the local tax department. This move aligns with the OECD’s initiative to enhance tax transparency and combat cross-border tax evasion in the rapidly evolving crypto market.
Under the terms of the agreement, the exchange of crypto asset data will only occur if the partner state reciprocates by sharing its data with South Korea. This mutual exchange of information aims to strengthen the detection of money laundering, crypto-related fraud, and tax evasion.
The Ministry of Economy and Finance is set to issue an administrative notice this month outlining the implementation regulations of the new crypto data sharing framework. This initiative comes at a time when the nation is also considering a Crypto Tax bill, which was postponed last year but is now set to be implemented in 2027.
The OECD’s framework requires crypto asset service providers to collect and report information on user tax residencies and identification numbers. Providers must also report annually on unusual or large crypto transactions. These measures are designed to enhance tax transparency and combat illicit activities in the crypto space.
In recent years, South Korea has witnessed a rise in crypto-related fraud cases, particularly tax evasion. The government has seized millions of dollars’ worth of cryptocurrencies from tax evaders, underscoring the need for stricter regulations and enhanced monitoring mechanisms.
By participating in the OECD’s Crypto-Asset Reporting Framework, South Korea is taking proactive steps to ensure compliance with international standards and strengthen its oversight of the crypto market. The sharing of information with partner states is expected to enhance transparency and accountability in the industry, ultimately benefiting both investors and regulatory authorities.