South Korea's government has pledged to focus on illegal activities in crypto markets.
The South Korean Financial Services Commission, Ministry of Finance, Ministry of Justice, among other regulators, met on April 7 to discuss virtual asset trading. In their announcement following the meeting, the authorities wrote:
"We will strictly crack down on illegal activities related to transactions such as market price manipulation, money laundering, and tax evasion using virtual assets through cooperation with the police, prosecution and financial authorities."
Furthermore, the authorities alluded to an increase in efforts to monitor crypto transactions in order to facilitate income tax collection on crypto-asset gains, a policy that's scheduled to come into effect at the beginning of 2021.
Following the meeting and the official announcement that crypto was in the crosshairs of regulatory action, the so-called "Kimchi premium," the longstanding elevated cost of BTC in South Korea, took a nosedive:
Wednesday's announcement seems to have reversed a trend in the Kimchi premium that The Block analyzed earlier this month.
It's important to note that none of the agencies involved in the meeting seems to have suggested actual changes in the country's laws or regulations. Instead, they merely affirmed a new focus on enforcing existing provisions.