11-02-2026 
|
Getting your Trinity Audio player ready...
|
TL;DR: South Korea’s digital asset industry is facing possible pressure on two fronts, as the central bank posits monthly balance reports on more than a million users who have moved crypto overseas, while the government is weighing whether exchanges should pay the “education tax” levied on banks and insurers—a change that hinges on the long-delayed Digital Asset Basic Act.
Key Takeaways:
- South Korea’s central bank wants monthly reports on crypto sent overseas and users’ personal details, but industry groups warn the broad plan may be unworkable.
- South Korea is considering an “education tax” on crypto exchanges, contingent on the proposed Digital Asset Basic Act classifying digital assets as a financial business.
- South Korea’s crypto law protects users and bans market abuse but leaves token issuance, disclosures and stablecoins largely unregulated.
South Korea’s central bank, the Bank of Korea (BOK), is proposing monthly reporting requirements for digital asset holders in the country, including personal information of users who transferred digital assets overseas and their domestic balances, causing backlash from industry advocates who claim the plan is excessive and unworkable.
According to an October 28 report from local outlet Seoul Economic Daily, the central bank sent the Digital Asset eXchange Alliance (DAXA)—a consultative and self-regulatory organization representing the country’s major cryptocurrency exchanges—a draft reporting manual earlier this month calling for the monthly submission of domestic digital asset holdings for any user with at least one record of an overseas transfer since July 19, 2024.
Reporting of cross-border digital asset transfers becomes mandatory on December 3 under the revised Foreign Exchange Transactions Act, but the specific scope and targets for reporting have yet to be finalized.
The bank’s proposal was met with immediate pushback from both the industry and some lawmakers. The office of Rep. Park Soo-young of the People Power Party—the largest opposition party—reportedly suggested that 1,272,878 users at the country’s five largest won-based exchanges had records of cross-border transfers between July 19, 2024, and September 30, 2026; all of them would be subject to the requirements.
Meanwhile, the BOK also met with officials from domestic cryptocurrency exchanges on October 16 to discuss practical problems arising from the plan. According to Seoul Economic Daily, citing “financial industry sources,” the exchanges raised at the meeting the concern that complying with the monthly balance reporting requirement would be almost impossible under the existing legal framework.
The exchanges also suggested that they cannot arbitrarily suspend deposits and withdrawals for customers who refuse to consent to sharing their information, which would leave them unable to meet the reporting obligations.
The BOK reportedly acknowledged the problem and is consulting with the Ministry of Economy and Finance on the issue.
“We are keeping all options open, including narrowing the scope of balance reporting as much as possible and requiring it only when necessary, and we are consulting with the Ministry of Economy and Finance,” a Bank of Korea official said, as reported by Seoul Economic Daily. “With the December 3 effective date approaching, we will finalize the details during November.”
In addition to enhanced reporting requirements for transfers and holdings, the South Korean digital asset industry could face an “education tax” if it is reclassified as a financial and insurance business under the proposed Digital Asset Basic Act.
South Korea weighs education tax on crypto exchanges
The South Korean government is reportedly considering whether digital asset exchanges should be subject to the so-called “education tax” that financial and insurance businesses are currently subject to, if digital assets are reclassified as financial businesses under the proposed Digital Asset Basic Act.
In South Korea, banks, insurance companies, and brokerage firms pay a specialized education tax designed to fund public school systems. This tax is levied at a rate of 0.5% to 1.0% on gross operating revenue rather than net profits, meaning companies must pay even if they are operating at a loss.
Digital asset firms are currently categorized under “information and communications” and, as such, have been exempt from this framework, but reclassification would change this. Some projections estimate this would bring with it a combined annual tax burden of over 13.4 billion won (around $10 million) for top domestic exchanges Dunamu and Bithumb.
The structural shift would also carry consumer implications, with digital asset exchanges likely to restructure or increase their base user fees to offset the heavy new operational tax burdens.
According to an October 27 Seoul Economic Daily report, citing “financial industry sources,” the government recently met with chief executives of domestic cryptocurrency exchanges and raised the education tax issue, during which a senior government official said that if digital exchanges move into the financial and insurance category through the legislation, there would be an education tax issue, adding that financial businesses will be given roles befitting that status.
But all of this depends on the passage, and in what form, of the government’s proposed Digital Asset Basic Act.
South Korea is regulating digital assets in two phases. The first, the Virtual Asset User Protection Act, has been in force since July 2024 and requires exchanges to hold customer cash with banks, segregate customer assets, keep insurance or reserves against hacks, and monitor for abnormal trading. It also criminalizes insider trading and market manipulation.
It does not, however, cover token issuance, disclosure, or stablecoins, and exchanges still operate under an anti-money-laundering (AML) registration system rather than full licensing.
This is where the second phase comes in, the Digital Asset Basic Act, which would introduce formal licensing for digital asset businesses, whitepaper and ongoing disclosure rules for issuers, and a legal route to issue won-pegged stablecoins.
Crucially, for tax purposes, the Act could also change how digital asset exchanges are classified, with exchanges currently counted as information and communications services, not financial companies, which exempts them from the education tax paid by banks, insurers, and securities firms.
However, the government version—which has been openly discussed but yet to be released in full—has been held up for over a year by disagreements among the Financial Services Commission (FSC), the BOK, and the ruling Democratic Party; the main disputes being who may issue stablecoins and a proposed 15–20% cap on major shareholders’ stakes in exchanges.
On October 22, FSC Chair Lee Eog-weon said talks were in their final stage, with its final publication expected “within this year,” but no submission date has yet been confirmed.
Until then, the industry faces an uncertain road, with the central bank’s reporting rules arriving on December 3—whatever form they may take—while the bigger questions of licensing, classification, and tax remain tied to a bill that has yet to leave the drafting stage.
FAQs:
What is the Bank of Korea proposing?
The BOK is proposing monthly reports from crypto exchanges on the domestic holdings and personal information of any user who has made an overseas transfer since July 19, 2024.
Why is the industry pushing back?
Exchanges say the requirement is nearly impossible to meet under current law, partly because they can’t suspend deposits or withdrawals for customers who refuse to share their information. Lawmakers have also objected, noting that more than 1.27 million users at the five largest won-based exchanges would be affected.
When do the new rules take effect?
Mandatory reporting of cross-border transfers begins December 3 under the revised Foreign Exchange Transactions Act. The BOK says it will finalize the details in November, possibly narrowing the scope of balance reporting.
What is the ‘education tax’ being considered for exchanges?
It’s a 0.5% to 1.0% levy on gross operating revenue that banks, insurers, and brokerages pay to fund public schools. It would apply to exchanges only if the Digital Asset Basic Act reclassifies them as financial businesses.
What is the Digital Asset Basic Act?
It is the planned second phase of regulation, introducing formal exchange licensing, issuer disclosure rules, and a legal route for won-pegged stablecoins.
Watch | DigiCon 2026: Interoperability starts with people
