South Korea’s tax agency, the National Tax Service (NTS), just issued a stern warning. They are coming for those hiding cryptocurrency. Even digital money stashed away in “cold wallets” – physical storage devices – will no longer be safe. The NTS confirmed it will conduct home inspections. This is part of a broad effort against tax evasion.
For years, it was tough to track hidden digital assets. Many were on foreign platforms or private devices. But the NTS is changing its game plan. The number of crypto investors in South Korea has exploded. It grew from 1.2 million to 10.77 million in just five years, ending June. This surge was reported by Cryptopolitan. Local news outlet Hankook Ilbo noted that crypto has become a major way to dodge taxes. Its anonymous nature makes owners hard to find. Authorities agree, saying digital asset trades are harder to oversee than stock or bank deals.
NTS Gets More Power
The NTS now has strong legal backing from the National Collection Act. This law lets them ask local exchanges for account details. They can also freeze funds belonging to people who owe taxes. The agency plans to search homes and seize hard drives or other storage devices. This will happen if tax evasion is suspected.
The NTS made its first big crypto seizure in 2021. They grabbed KRW 71.2 billion from 5,741 wealthy taxpayers. Inspectors can ask exchanges for “Know Your Customer” (KYC) data. This helps them find and block digital assets. These powers come from their “Inspection Rights” under tax laws. Deputy Kim Young-jin from Korea’s Democratic Party shared new figures. Since 2021, the NTS has seized KRW 146.1 billion in digital assets. This came from 14,140 people who owed money.
More Financial Crimes Linked to Crypto
This crackdown isn’t just about taxes. It’s also about a rise in financial crimes involving crypto. The Financial Supervisory Service reported a massive transfer. Crypto assets worth KRW 78.9 trillion moved from national exchanges to cold wallets. This happened in the first half of 2025 alone.
Meanwhile, the Financial Intelligence Unit (FIU) sees a sharp jump in suspicious transaction reports. Between January and August 2025, virtual asset firms filed 36,684 reports. This number is more than the combined total from the two previous years, which was 35,734 cases. The Korean Customs Service also sounded an alarm. From August 2021 to August 2025, crypto-related crimes reached KRW 9.5613 trillion. A staggering 90.2% of these crimes were money laundering schemes. Last May, customs officers caught an operator. This person illegally exchanged KRW 57.1 billion in cash, from a Russian importer, for Tether stablecoins.
Stablecoin Risks and Legal Action
Legislator Seongjun Jin raised concerns about stablecoins. He warned that using them more for payments in the real world increases risks. These include currency crimes and money laundering. “As stablecoins are increasingly used in real transactions, the potential for them to be used for international financial crimes also grows,” Jin explained.
Jin called on groups like the FIU and the Customs Service to act. He wants them to create better ways to fight these new types of financial crime. This includes tracking illegal money and finding hidden remittances. With these steps, South Korea is getting tougher on crypto-related evasion and financial crimes. The country is already a major player in digital assets. It aims to build a stronger system combining tech oversight, government teamwork, and real penalties.
