South Korea ruling party formally proposes two-year crypto tax delay

South Korea's ruling party formally proposed a deferral of the country's crypto income tax on 4 November. The Block reported that the party seeks to postpone the levy, which is currently scheduled to begin on 1 January 2027. Party leaders are discussing a two-year delay to allow for the creation of a more thorough regulatory structure for the domestic market.

Kim Min-seok, a senior official in the party, said the government should first enact the Digital Asset Basic Act before taxing investors. The Defiant reported that this framework would provide a comprehensive legal basis for the industry. Proponents of the delay argue that taxing digital assets without a clear regulatory foundation would be premature for the growing sector.

This proposal comes as South Korean regulators tighten oversight following a $6.3bn security breach at Binance in late October. YourKhabri previously reported that the central bank surveyed nine major lenders to assess the impact of the hack, which has been linked to North Korean attackers. In response to the exploit, South Korea is also considering a new rule that would require exchanges to store 99 per cent of user funds in cold wallets.