South Korea Tax Agency Targets Cold Wallets in Crypto Seizures

South Korea's National Tax Service (NTS) is intensifying its crackdown on tax evasion, warning that cryptocurrencies stored in cold wallets are also at risk of seizure. The agency plans to conduct home searches to confiscate hardware and cold wallets if there are suspicions of tax evaders hiding their assets offline. The NTS has been tracking the transaction histories of tax delinquents and will initiate searches if they suspect assets are concealed. Under the National Tax Collection Act, the NTS can request account data from local exchanges and liquidate assets to cover unpaid taxes. The NTS has seized and liquidated over $108 million in cryptocurrencies over the past four years, reflecting a spike in crypto investment and related tax evasion cases in the country. The number of crypto investors increased to almost 11 million as of June 2025, up from just 1.2 million in 2020, prompting heightened enforcement activities. Additionally, there has been a record number of suspicious transaction reports filed this year, surpassing totals from the previous two years, which signals increased oversight in the crypto domain.

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