South Korea requires crypto service providers to report all crypto transactions or face 5 years in prison

With the introduction of the latest law on financial reporting of crypto businesses, cryptocurrency regulation in South Korea will become stricter. According to Korea JoongAng Daily, the Financial Services Commission of South Korea has revised its financial reporting rules to include cryptocurrencies.

The amendment requires all crypto businesses — such as exchanges, crypto asset managers, wallet providers, and custodial platforms — to submit transaction records to the Financial Intelligence Unit (FIU).

The FIU is a unit of the Financial Services Commission that oversees anti-money laundering activities throughout South Korea’s financial ecosystem.

As part of the compliance agreement, these crypto service providers must adopt a solid customer identification protocol. In addition, any suspicious transactions must be flagged and reported to the FIU for further money laundering investigation.

South Korea’s cryptocurrency reporting regulations will take effect on March 25. Existing virtual asset service providers will have six months to comply with the new regulations.

If the country’s virtual asset service providers fail to comply with crypto reporting regulations by September 24, their major players could face fines of up to 50 million won (about $44,000) or five years in prison.

Starting March 25, new crypto service providers planning to establish a branch in the country must register with the FIU.

The upcoming crypto business reporting regulations are just the latest in a series of laws and guidelines related to cryptocurrency regulation in South Korea. In addition to this new regulation, there have also been new developments in the regulations related to crypto taxation.

As Cointelegraph previously reported, the country's crypto tax rules will take effect in January 2022. The law requires capital gains tax on cryptocurrency trading profits exceeding $2,300. In addition, the National Tax Service (NTS) of South Korea revealed on Monday that they have identified more than 2,400 people who hid their assets in cryptocurrencies to evade taxes. Today, related news also became a hot search on Weibo.

Currently, in order to cooperate with the NTS to identify more tax evaders who hide their assets through virtual currencies, South Korean crypto exchanges have shared customer data with the agency.

Original article: https://cointelegraph.com/news/report-all-crypto-transactions-or-face-5-year-jail-term-in-south-korea

By OSATO AVAN-NOMAYO

Compiled by: Yunjin