South Korean authorities plan to introduce special regulations for cross-border cryptocurrency transactions in 2025. The initiative is designed to strengthen methods of combating tax evasion and currency crimes.
Choi Sang-Mok, South Korea’s finance minister, speaking at a meeting of G20 member countries in Washington, D.C., said that all companies handling cryptocurrency transfers outside the country will be required to pre-register with the Bank of Korea and submit monthly reports on their activities.
Sang-Mok noted that the current format of cross-border crypto transactions creates a blind spot for tax and customs authorities, which is actively exploited by criminals. The minister noted that, according to the Korea Customs Service, 81% of all detected currency crimes since 2020 have involved digital assets. The loss amounts to approximately $1.2 billion.
Under the new rules, companies involved in international cryptocurrency transfers will be required to pre-register and obtain a special permit, as well as submit monthly reports to the relevant authorities. Sang-Mok said he hoped this approach would prevent digital assets from being used to hide income and currency manipulation.
The ministry has also initiated amendments to the Foreign Exchange Law that will introduce clear definitions of ‘virtual assets’ and ‘virtual asset operators’. The initiative will make cryptocurrencies a separate category – outside of traditional currency and capital market transactions.
The new system will be implemented in the second quarter of 2025, following legislative amendments in the first half of the year.
South Korea recently passed the Virtual Asset Protection Act, which requires crypto service providers to insure user funds against hacking and ensure that customer funds are stored separately from platform assets. The country’s government has also introduced stiff penalties for cryptocurrency-related crimes, banned the purchase of cryptocurrencies with credit cards and tightened supervision of stablecoins.
