South Korea’s top financial regulator has signaled that consultations on a comprehensive digital asset law are approaching their conclusion, even as lawmakers and market participants step up pressure over the timing of a long-postponed tax on cryptocurrency gains.
On October 22, 2026, during a comprehensive audit by the National Assembly’s Political Affairs Committee, Financial Services Commission Chairman Lee Eog-weon stated that inter-agency discussions on the Digital Asset Basic Act had entered their final phase.
He pledged to move the measure forward as quickly as possible so that formal legislative review could begin.
The proposed statute is intended to establish a unified legal foundation covering the issuance and distribution of digital assets.
Key elements include licensing regimes for cryptocurrency exchanges, rules for the issuance of stablecoins, and clearer statutory definitions of the assets themselves.
Remaining points of negotiation reportedly involve ownership-cap limits for major shareholders of exchanges and the structure for won-denominated stablecoins, which has centered on consortia in which banks hold a controlling stake.
At the same hearing, opposition lawmaker Song Eon-seok questioned the sequence of imposing taxation before the basic regulatory framework is complete.
He noted that the fundamental nature of digital assets and the broader policy direction toward them have not yet been settled.
In reply, Lee emphasized that the various circumstances surrounding virtual-asset taxation should be fully taken into account.
He added that diverse views are currently being collected—an observation also attributed to the deputy prime minister and minister of economy and finance.
The tax itself was introduced through a 2020 revision of the Income Tax Act and has already been deferred three times.
It is presently scheduled to begin on January 1, 2027.
Under the existing rules, a combined rate of 22 percent (other-income tax plus a local income-tax surcharge) would apply to annual income from the transfer or lending of digital assets that exceeds a basic deduction of 2.5 million won (approximately $1,800).
The National Tax Service has continued preparations on the assumption that the January start date remains in place, aiming to finalize a draft notice by the end of October and issue formal guidance in November.
Calls to reconsider the schedule have multiplied.
Two public petitions—one seeking repeal and another requesting a two-year further delay—have each crossed the 50,000-signature threshold that triggers legislative review.
Within the ruling Democratic Party, leader Kim Min-seok has called for a definitive resolution by year’s end.
Appearing on party media, he said the time had come for intensive review of whether to proceed as planned or to strengthen the system first, and he has raised the matter directly with the finance minister.
Lawmakers from both major parties have filed competing bills; one Democratic proposal would link the effective date to the first year of international information exchanges under the OECD’s Crypto-Asset Reporting Framework, which could push implementation to 2029.
Practical concerns cited by critics include the difficulty of obtaining transaction records from overseas platforms and decentralized exchanges, the lack of loss-carryforward provisions, and the time exchanges need to build compliant reporting systems.
Some officials have privately noted the administrative challenge of taxing an estimated 11 million investors while supporting infrastructure remains incomplete.
The near-completion of the Digital Asset Basic Act and the unresolved tax timetable are expected to dominate upcoming committee sessions. A government draft of the framework law could be ready by the end of October, after which party-government talks would shape the text introduced for lawmaker sponsorship.
