South Korea's Financial Intelligence Unit (FIU) has approved the blocking of 27 cryptocurrency platform websites as part of its regulatory crackdown on unregistered digital asset platforms. The blocked platforms include major foreign exchanges like KuCoin, MEXC, and Phemex, along with domestic platforms such as BingX, Bitrue, CoinW, Poloniex, BTCC, BitMart, and DigiFinex. According to the Financial Intelligence Unit, the decision was made during meetings on October 6 and 7 at the request of the FIU, with the Korea Communications Standards Commission (KCSC) approving the blocking action. The FIU has also passed information on 44 unlicensed cryptocurrency companies to law enforcement agencies, though authorities acknowledge that blocking websites could complicate fund withdrawals for existing clients. In August 2022, the FIU had previously sought to block access to 16 platforms, including KuCoin and MEXC, over alleged failures to meet local requirements, marking this as an escalation in enforcement measures.
South Korea's National Tax Service (NTS) has announced plans to issue cryptocurrency tax guidelines in November 2026, ahead of the country's scheduled 22% tax on qualifying digital asset gains beginning January 1, 2027. According to reports from The Economic Times, NTS Commissioner Lim Kwang-hyeon told lawmakers during an October 13 parliamentary audit that preparations were underway to publish detailed taxation standards next month. The announcement follows three previous implementation delays since lawmakers first approved the framework in 2020, with the latest delay approved in December 2024. The combined tax rate will be 22%, including a base tax of 20% and a local levy of 2%, with an annual deduction of ₹2.5 million won. Taxable income is calculated after acquisition costs and transaction expenses, and annual gains and losses are combined before the basic deduction applies.
Under South Korean law, cryptocurrency companies must register with the FIU and meet information security requirements, including obtaining an ISMS certificate. These rules also apply to foreign platforms serving residents of the country, with the regulator considering the presence of a Korean-language interface, marketing campaigns for local users, and support for won transactions. Operating without registration can result in up to five years in prison or a fine of up to ₹4.5 crore (approximately $36,000). The FSC believes that unregulated platforms pose risks of data breaches, hacking attacks, money laundering, and fraud, with the agency also warning about the lack of adequate client protection mechanisms. In June 2026, the industry association DAXA, together with registered crypto operators, identified 12 companies operating without the necessary registration.
Tax officials are currently reviewing how staking, airdrops, hard forks, and decentralized finance transactions should qualify under the new framework. According to Lim's testimony during the parliamentary audit, airdrops and hard forks may fall within the tax framework when their economic characteristics meet relevant legal requirements, though additional consultation with the Ministry of Finance and Economy is necessary for some activities including staking. The NTS has not published final standards covering every category of cryptocurrency activity, with the tax base calculation also considering legally stipulated expenses. Digital assets acquired before the rules begin receive special treatment, with their acquisition value generally using the higher of the original cost or the market value just before implementation.
With just three months remaining before implementation, South Korea's 13 million cryptocurrency investors are facing mounting confusion due to the absence of clear tax rules for different transaction types. A petition submitted in August seeking to postpone taxation to 2029 had gathered more than 50,000 signatures by mid-September, necessary for submission to the relevant parliamentary committee. However, the consideration of the petition itself does not change the legally established deadlines. The People Power Party has pursued legislation seeking to delay or abolish the planned tax, with an August proposal seeking to postpone implementation until January 2030. Finance Minister Lee Hyoung-il acknowledged difficulties in estimating revenue generation from the proposed system during an October 6 parliamentary hearing. Exchanges discussed at the hearing include Upbit, Bithumb, Coinone, DigitalX and Gopax, with lawmakers questioning whether their records would be consistent enough to meet the deadline.
The FIU's blocking action represents a significant escalation in South Korea's regulatory enforcement, building on previous measures that included Google Play blocking 17 unregistered crypto exchanges in March 2025 and similar restrictions affecting 14 apps in the App Store in April. The measures extend enforcement beyond mobile applications to websites, marking a broader crackdown on unregistered platforms. The regulator plans to organize informational support for users in collaboration with DAXA and platform operators to address withdrawal complications. Additionally, authorities will continue to monitor alternative domains of blocked services, with access to be restricted immediately upon detection of illegal activities without waiting for investigations to conclude. Commissioner Lim noted that once the law takes effect, the agency must receive data and begin verification starting from the tax returns filed in May 2028.
