Tax Authorities Raid South Korean Cryptocurrency Exchanges; These Crypto-Portfolios Could Be Impacted The Most
Holders of BTG, QTUM, XRP, and EOS stand to be affected
South Korea’s Crackdown on Cryptocurrency Rrading
In line with the South Korean government’s attempts to calm the frenzied demand for cryptocurrency trading in the country, its tax authorities on Wednesday raided major cryptocurrency exchanges for alleged tax evasion. South Korea is considering taxing capital gains from cryptocurrency trading, considering the excess (as much as 40% above the international rate) premiums being paid to traders on these exchanges.
Cryptocurrency exchanges in South Korea have also been subject to police investigation since late December over their margin trading services. Back in December 2017, the South Korean government released “emergency measures” for cryptocurrency regulation, and according to Yonhap News, January 20th 2018 should see a raft of new laws implemented across the country.
These Crypto-Portfolios Should Brace for Impact
South Korea is currently the world’s third largest digital currency market, after the US and Japan. The country is also home to some of the busiest global digital-currency exchanges (by volume), namely, Bithumb, Coinone, Korbit, and Coinnest, which together account for over 20% of global cryptocurrency trading volumes. From a currency perspective, South Korean exchanges constitute the largest trading market. So, those crypto-portfolios with a significant share in any of these cryptocurrencies (see table above) stand to be impacted the most by the government’s crackdown on crypto-trading, and the new regulations that will be announced soon. Hodlers of Bitcoin Gold (BTG), Qtum (QTUM), Ripple (XRP), and EOS (EOS) should particularly be watchful.
As of January 11th 2018, South Korean exchanges commanded a significant share of these cryptocurrency’s trading volumes (table above). What remains to be seen is whether stricter regulation will be able to impact South Korea’s dominance in the cryptocurrency market.
Image Credit: Deposit Photos