South Korean Petition Seeks to Halt Crypto Tax as Industry Contraction Continues

South Korea's cryptocurrency sector is facing increased scrutiny from lawmakers as a petition to scrap a new tax on crypto investment gains gathers momentum. The tax, which is set to take effect in January 2027, would impose a 22% levy on profits from crypto investments, but critics argue it will have unintended consequences for the country's economy.

According to industry data, the total value of cryptocurrencies held by South Koreans has declined significantly over the past year, falling from 121.8 trillion won ($83.3 billion) in January 2025 to 60.6 trillion won ($41.4 billion) in February 2026. Daily trading volumes on the country's largest exchanges have also plummeted, down from $11.6 billion in December 2024 to just $3 billion in February.

The petition, which has now surpassed 50,000 signatures, argues that the tax will limit upward mobility for younger individuals, who are already locked out of housing markets due to soaring real estate prices. The authors also claim that taxing crypto gains at 22% while giving other asset classes preferential treatment undermines South Korea's share of the global crypto market.