Why are South Korean investors opposing the new crypto tax?

Critics argue the planned 22% tax on crypto investment gains is too high compared with taxes on other asset classes in South Korea. Opponents say the policy could discourage investment, reduce market activity and push capital overseas.

What is South Korea’s proposed crypto tax rate?

South Korea plans to introduce a 22% tax on crypto investment gains starting in January 2027. The tax would apply to profits from cryptocurrency trading and investment activity.

Why did the anti-crypto tax petition gain attention?

The petition reached 50,000 signatures, which is the threshold required for South Korea’s Finance and Economic Planning Committee to formally review objections. That gives critics a pathway to push lawmakers to reconsider or revise the policy.

Why are younger South Koreans particularly concerned about the crypto tax?

The petition argues younger people increasingly use crypto investing as an alternative wealth-building tool because rising property prices have made housing unaffordable. Critics say higher crypto taxes could reduce opportunities for younger investors to build savings or capital.

How important is crypto adoption in South Korea?

South Korea remains one of Asia’s largest retail crypto markets, with roughly 32% of the population reportedly owning cryptocurrencies in March 2025. The country has historically been a major hub for crypto trading volumes and retail participation.

Is South Korea’s crypto market already slowing down?

Yes, industry data showed the value of crypto held by South Koreans dropped from about $83.3 billion in January 2025 to $41.4 billion in February 2026. Trading volumes on major exchanges also declined sharply over the same period.

Which crypto exchanges are most affected by South Korea’s tighter rules?

Major domestic exchanges including Upbit, Bithumb, Coinone, Korbit and Gopax have all experienced falling trading activity as regulations tighten.

What new crypto monitoring rules is South Korea proposing?

South Korean regulators proposed automatically flagging crypto transactions above 10 million won ($6,630) involving foreign wallets as suspicious. The rules are part of broader anti-money laundering and Know Your Customer enforcement efforts.

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South Korea petition challenges 22% crypto tax

Written by Mahathir BayenaPublished May. 22 2026Last Updated May. 22 2026

A petition seeking to scrap South Korea’s planned 22% crypto investment gains tax reached the 50,000-signature threshold required for review by the country’s Finance and Economic Planning Committee.

The tax, scheduled to take effect in January 2027, has drawn criticism from investors who argue it places disproportionate financial and reporting burdens on crypto holders compared with other asset classes receiving more favourable treatment.

Petition organisers also argued the policy could further limit economic opportunities for younger South Koreans already struggling with rising housing costs and reduced access to traditional wealth-building assets.

“If taxation is enforced in order to secure short-term tax revenues, it is likely to lead to greater losses in the long term, namely, a contraction of industry and an outflow of capital and talent abroad,”

The petition stated.

South Korea remains one of Asia’s largest crypto markets, with local media outlet Yonhap reporting that roughly 32% of the population owned cryptocurrencies in March 2025, though ownership and trading activity have declined this year amid weaker market conditions.

Industry data showed the total value of crypto held by South Koreans fell from about 121.8 trillion won ($83.3 billion) in January 2025 to roughly 60.6 trillion won ($41.4 billion) in February 2026, while daily trading volumes across exchanges including Upbit, Bithumb and Coinone dropped from $11.6 billion in December 2024 to $3 billion in February.

Regulatory pressure has also intensified after South Korea’s Financial Services Commission and Financial Intelligence Unit proposed automatically flagging crypto transfers above 10 million won involving foreign wallets, prompting industry groups to warn that stricter AML and KYC requirements could create operational burdens for exchanges and accelerate capital outflows from the sector.