Korean Tax Authority Seizes Crypto Assets from 49 Individuals Owing 14.2 Million USD, Ending the Crypto Asset "Gray Area" Tax Period.
The period when crypto assets were considered a "gray area" for hiding income in South Korea is gradually closing. Recently, the tax authority of Jeju city launched a strong campaign aimed at freezing and seizing digital assets of tax-delinquent individuals, marking a decisive step in tightening market management.
The investigation targeted 2,962 individuals with a total tax debt of 14.2 million USD. By analyzing data from major domestic exchanges like Upbit, Bithumb, Coinone, and Korbit, the authorities identified 49 individuals still holding crypto assets valued at over 166,000 USD.
The exchanges were immediately designated as "third parties responsible for debt collection" – a legal mechanism allowing authorities to freeze and liquidate these assets to offset lost revenue.
The Jeju campaign is not an isolated action, but a concrete implementation of the legal framework established in 2021, which allows the government to seize digital assets from tax-delinquent individuals. A notable new development is the deployment of artificial intelligence (AI) to analyze and trace transactions.
Mr. Hwang Tae-hoon, Jeju Tax Bureau Chief, emphasized that the agency will "continue to recover taxes from large-scale tax evaders through AI data analysis", indicating that technology is becoming a central tool in enforcement.
The macro context further clarifies the importance of this move. With over 16 million users, equivalent to more than 30% of the population, South Korea's crypto asset market has reached a scale that cannot be ignored. The widespread adoption of digital assets also brings the risk of potential financial illegal activities, especially tax evasion.
Previously, the central government had seized hundreds of millions of USD in crypto assets from violating individuals. The Jeju campaign is the latest evidence that digital assets, like traditional assets, cannot escape legal oversight and sanctions.
