Sohn Byung-doo, a digital asset industry executive, stated at the 2021 Global ETP Conference that it is similar to capital markets. He stressed the importance of investor protection and support for transaction stability.
KRX Chief Wants to Study Cryptography
Bitcoin and other cryptocurrencies are still outside the scope of the national regulatory framework that covers traditional financial sectors.
Byung-doo also highlighted the increasing number of cryptocurrency investors in South Korea, around 5 million, and the rapidly growing daily trade volume in South Korea’s crypto market. This is right after the stock market.
For perspective, the daily trading volume of Korean crypto-assets is approximately $12 billion. The KOSPI composite index is slightly more than $16 billion.
Sohn stated that while the country must study and explore new ways to embrace this burgeoning sector, he also called for proper regulation to institutionalize the asset class. Sohn also said,
“Now is the right time for exchanges that compete directly with exchanges overseas.”
South Korea’s Crypto Tax: No Delay
The South Korean finance ministry had announced earlier this week that it would delay taxing cryptocurrency profits. A South Korean National Assembly finance committee amendment has approved that the crypto tax law which was due to take effect on January 1, 2022, is being delayed for one year.
Initial announcements about taxing cryptocurrency profits caused a lot of controversy and backlash from crypto investors all over the country. It proposed to levy 20% tax on digital assets gains above $2,100. Many crypto investors protested the tax plan and flooded South Korea’s Cheongwadae website.
Two main reasons led to the outrage. First, these investors were being taxed more than stock market participants. The threshold for capital gains taxation is $42,000. Second, the regulatory framework that protects cryptocurrency investors is not in place. Many people consider taxation unreasonable.
Recenty, the Financial Services Commission of the country (FSC), called the National Assembly to enforce criminal liability for unfair practices like price manipulation and insider trading on the cryptocurrency market.
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Marla Brooks – Financial Analysis
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