South Korea launches AI system to monitor crypto taxes

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South Korea builds AI platform to analyze crypto trading

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Anastasiia Chabaniuk

12.03.2026

South Korea launches AI system to monitor crypto taxes — South Korea strengthens crypto market oversight using AI

South Korea’s tax authority plans to deploy artificial intelligence to analyze cryptocurrency transactions as part of preparations for introducing a tax on digital asset profits. The project is estimated to cost around 3 billion Korean won (about $2 million).

According to The Korea Times, the country’s National Tax Service (NTS) has opened a tender to develop a system capable of processing large volumes of cryptocurrency trading data and identifying potential cases of tax evasion. The platform will use machine learning and AI algorithms to detect unusual transactions, suspicious patterns and undeclared income. The tax agency aims to select a contractor by the end of March, with development scheduled to begin in April. Testing phases will follow throughout the year.

A pilot version of the platform is expected to launch in November, while the full system is planned to go live by the end of 2026. According to the NTS, the platform will help authorities process large volumes of crypto transaction data, support tax audits and identify hidden income.

The analyzed data may also be shared with other government agencies, including the Korea Customs Service and the Bank of Korea, to strengthen oversight of financial flows.

South Korea prepares to introduce crypto profit tax

South Korea has repeatedly delayed the introduction of a tax on cryptocurrency profits, even though the legislation was originally passed in 2020. The government now plans to implement the new tax framework in January 2027.

Under the proposed system, crypto investment gains exceeding 2.5 million won (about $1,700) will be taxed at 22%, including 20% income tax and 2% local tax. In addition, South Korea has recently launched a large-scale investigation following new failures in the storage of confiscated cryptocurrency assets.

How South Korea regulates the crypto market

South Korea is considered one of the most tightly regulated cryptocurrency markets in the world. The core framework is the Virtual Asset User Protection Act, which came into force in 2024 and established rules for digital asset custody, investor protection and oversight of crypto exchanges.

Under the law, crypto platforms must store most user assets in cold wallets, maintain insurance coverage for deposits and report suspicious transactions to financial regulators. The country also operates a real-name verification system for crypto trading, meaning users can open exchange accounts only through bank accounts linked to their verified identities.

Regulators are also working to expand oversight of the sector. Authorities plan to tighten controls on stablecoins, crypto custody services and influencers promoting digital assets.

Earlier reports indicated that South Korea is considering stronger crypto regulation following the Bithumb incident.

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