Daily Crypto Deep Dive: South Korea’s 22% Crypto Tax — Will Traders Move Offshore?

South Korea is preparing to introduce a combined 22% tax on cryptocurrency profits from January 1, 2027—but could the policy drive traders, liquidity and crypto businesses out of the country?

In today’s Daily Crypto Deep Dive, we explain exactly how the new tax will work, including the 2.5 million won annual allowance, how taxable profits will be calculated and why the absence of loss carryforwards has become one of the policy’s most controversial features.

We also examine analyst and industry commentary warning that the tax could disproportionately affect investors using regulated Korean exchanges while wealthier and more experienced traders move toward overseas exchanges, decentralised finance and self-custody wallets.

With approximately 47 trillion won reportedly transferred from Korean exchanges to overseas platforms and personal wallets during the first half of 2026, the movement of Korean crypto capital has already begun. The central question is whether the new tax will generate meaningful revenue—or accelerate an existing offshore migration.

Could the policy weaken exchanges such as Upbit and Bithumb? Will international reporting systems allow South Korean authorities to track overseas activity? And is taxing crypto gains at 22% fair when many domestic stock investors pay no equivalent capital gains tax?

This episode is sponsored by Kraken.

This podcast is provided for informational and entertainment purposes only and does not constitute financial advice. Cryptocurrency trading and investing involve a substantial risk of loss. Never invest money you cannot afford to lose.

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