South Korea's Crypto Data to Go Global by 2026

South Korea has officially joined the Crypto-Asset Reporting Framework (CARF) under the Organization for Economic Cooperation and Development (OECD), marking a major step in global efforts to enhance transparency and combat tax evasion in the cryptocurrency sector. The South Korean Ministry of Economy and Finance recently signed an agreement to implement the framework, following its formal adoption in November 2023 alongside 48 other nations [2]. This initiative is part of a broader international strategy to standardize the automatic exchange of tax information related to crypto transactions, ensuring greater accountability in the digital asset space.

Under the CARF, South Korea will begin collecting and sharing data on both domestic and international crypto transactions. This includes the activities of non-residents on domestic exchanges such as Upbit and Bithumb, as well as the transaction histories of South Korean investors on foreign platforms [2]. The information will be transmitted to the National Tax Service and uploaded to the OECD system for cross-border tracking. The implementation of CARF is expected to start in 2027, with transaction records becoming available as early as 2026 [2]. A formal administrative notice detailing the framework’s implementation is set to be issued by the Ministry in the coming months [2].

The move is likely to have significant implications for the South Korean crypto market. Exchanges such as Upbit and Bithumb will be required to collect and disclose personal and transaction data for users from CARF-partner countries, beginning in 2026. While the government has emphasized that the initiative is primarily about regulatory compliance and not directly tied to taxation, the increased scrutiny may lead to reduced anonymity in crypto trading [2]. Privacy-conscious users might see a shift in activity, with some potentially moving to platforms that offer greater anonymity, which could affect trading volumes and compliance costs for domestic exchanges.

The initiative also aligns with global trends in crypto regulation, particularly in jurisdictions such as the UK, Germany, and Japan, which have been advancing similar frameworks to enhance tax transparency and deter offshore tax evasion. The CARF is seen as a critical tool for governments to close loopholes and enforce compliance in the rapidly evolving digital asset landscape [2]. South Korea’s participation underscores its commitment to aligning with international standards and could influence other countries in the region to adopt similar measures.

Domestically, the government has emphasized that the CARF implementation will not impact the broader regulatory approach to crypto assets. However, the introduction of stricter reporting requirements may accelerate the formal integration of crypto into the financial regulatory infrastructure, a trend already underway in countries such as Japan [4]. This shift could also pave the way for the introduction of additional safeguards and investor protections, potentially increasing institutional and retail participation in the market over the long term [5].

Source: [1] Binance, Upbit Race to List World Liberty Financial, WLFI Derivatives Shoot 500% (https://finance.yahoo.com/news/binance-upbit-race-list-world-093936639.html) [2] South Korea to Share Crypto Transactions Data Globally – Report (https://finance.yahoo.com/news/south-korea-share-crypto-transactions-054835878.html) [3] Crypto Regulation Update: U.S. CFTC, Europe's MiCA ... (https://99bitcoins.com/news/presales/crypto-regulation-update-u-s-cftc-europes-mica-japans-support-and-what-it-means-for-memecoins/) [4] Japan's Financial Regulator Moves to Establish Crypto ... (https://www.ccn.com/news/crypto/japan-financial-regulator-fsa-crypto-asset-division/) [5] Japan Plans Flat 20 Percent Crypto Tax To Match Equities (https://coinfomania.com/japan-plans-flat-20-percent-crypto-tax-to-match-equities/)