South Korea is approaching a key stage in its effort to build a formal legal framework for digital assets, with Financial Services Commission chairman Lee Eog-weon saying the Digital Asset Basic Act is close to completion. His comments, delivered at a parliamentary hearing on Thursday, suggest the government is preparing to move the bill forward soon.
At the same time, a separate fight over crypto taxation is becoming more intense. The planned tax is due to begin on January 1, 2027, but it has already been delayed three times, and new public petitions and political debate are raising the possibility of another change.
Framework bill enters final stretch
The Digital Asset Basic Act is intended to serve as South Korea’s main legal framework for crypto assets. According to Lee, consultations on the measure are nearing completion, and the government plans to push for its introduction as soon as possible.
The proposal is expected to define the rules that govern core parts of the market. As outlined in the discussions so far, it would cover licensing requirements for crypto exchanges, rules for stablecoin issuance, and clearer legal definitions for digital assets.
If adopted, the law could give exchanges and token issuers more certainty about how to operate. For investors, a clearer set of rules could reduce some of the legal ambiguity surrounding the trading and holding of digital assets.
Important details still unresolved
Even with the bill reportedly nearing completion, several specifics have not been laid out in the public reporting. The available accounts did not include details such as capital requirements or reserve rules for stablecoin issuers.
That leaves open questions about how strict the regime may ultimately be for firms seeking to issue or manage digital assets in South Korea. Because consultations are still in their final phase, parts of the proposal could still change before it is formally submitted to the National Assembly.
Tax dispute gathers momentum
While regulators work on the market framework, lawmakers are also under pressure over the separate issue of crypto taxation. The tax is scheduled to take effect at the start of 2027, but fairness concerns and questions about implementation infrastructure have already led to three earlier postponements.
Public pressure has continued to build. A petition filed in May calling for repeal of the tax reached 53,809 signatures, enough to trigger a legislative review. A second petition, submitted in August and seeking a two-year deferral, also passed the review threshold in mid-September.
Kim Min-seok, leader of the ruling Democratic Party, said he is reviewing different inputs on the tax plan and called for a thorough final review. His remarks indicate the party has not yet settled on a final position. Lee likewise said crypto taxation should take various circumstances into account.
Timing questions now come into focus
The debate is increasingly centered on sequencing. Some lawmakers are concerned that taxation could begin before the country has fully established the basic legal rules for exchanges, issuers, and digital assets more broadly.
For now, the National Tax Service is expected to finalize its draft tax notice by October 30. A preliminary review and public notice are then supposed to follow in November. That timetable leaves limited room for adjustment if lawmakers decide to seek another delay before the January 1, 2027 start date.
The next confirmed step, then, is the tax authority’s draft notice, while the broader market is also waiting to see when the government formally introduces the Digital Asset Basic Act to the National Assembly.
Source: beincrypto.com