Cryptocurrency users in South Korea are experiencing things going from bad to worse as government authorities have now stated that every citizen is required to report any and all crypto transactions they witness taking place or face a prison sentence of 5 years. South Korea’s government had been coming down hard on crypto exchanges within their country, much to the dismay of consumers and investors.
As of the time of this writing, existing crypto firms and exchanges in South Korea will be given up to 6 months to comply with the new rules that have been and continue to be put in effect. Otherwise, they will be subject to extremely harsh penalties and regulations, including both hefty fines and jail time.
South Korea officially includes cryptocurrency in its financial reporting rules
For the longest time, cryptocurrency has been a bit confusing for governments and regulatory bodies mainly because of its volatile nature and usual lack of anyone governing them. Many have compared it to a kind of ‘free for all, where anyone can experience the highest of highs or lowest of lows in an instant. This ultimately led to South Korea deciding to officially include cryptocurrency into its financial services sector, thereby also amending South Korea’s Financial Services Commission to reflect this significant change.
Ever since the country has started implementing their new laws governing cryptocurrency, we have witnessed the administration of harsh penalties, outrageous fines, and now even prison sentencing. This has led many crypto exchanges to shut down prematurely and even more, investors to either go into hiding or escape the country entirely. The government has also demanded that all crypto managers and firms register themselves with the Financial Intelligence Unit (FIA) and provide records of all of their previous transactions.
The future for crypto looks bleak as the crackdown continues
Not only will all future crypto exchanges in South Korea have to register themselves with the FIA, but they will have their activities monitored and their influence substantially reduced. Even so, there have been over 2,000 reports of individuals still attempting to conduct their business, as usual, even going as far as to hide their various assets in cryptocurrencies in an attempt to avoid paying taxes.
Ultimately, only time will tell what will happen to South Korea’s crypto investors and the developing situation there. Hopefully, things will get better sooner than later.