A public petition calling for the repeal of South Korea’s planned 22% tax on cryptocurrency investment gains has exceeded the 50,000-signature threshold required for the National Assembly’s Finance and Economic Planning Committee to review objections to the policy.
The tax, scheduled to take effect in January 2027, has drawn criticism from investors and industry groups who say it creates heavy financial and reporting burdens and disproportionately harms younger people already priced out of housing by soaring real estate costs. The petition’s authors argue that treating crypto gains more harshly than other asset classes will weaken South Korea’s position in the global crypto market and could spur capital and talent to leave the country.
In a translated passage, the petition warned: “If taxation is enforced in order to secure short-term tax revenues, it is likely to lead to greater losses in the long term, namely, a contraction of industry and an outflow of capital and talent abroad.” The petition has since grown to more than 52,000 signatures.
South Korea remains an important crypto market in the Asia-Pacific region. In March 2025, roughly 32% of the population owned some form of cryptocurrency, according to local reporting. But market participation has weakened as prices fell and regulatory pressure increased this year.
Industry data show a substantial contraction in holdings and activity: the total value of crypto held by South Koreans dropped from about 121.8 trillion won (roughly $83.3 billion) in January 2025 to about 60.6 trillion won ($41.4 billion) in February 2026. Daily trading volumes across the country’s five largest exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — fell from around $11.6 billion in December 2024 to roughly $3 billion in February 2026.
Regulatory developments are cited as a key factor in the pullback. South Korean authorities have proposed tighter anti-money laundering (AML) and know-your-customer (KYC) measures. In March, the Financial Services Commission (FSC) and the Financial Intelligence Unit (FIU) suggested that all crypto transfers above 10 million won (about $6,630) to or from foreign wallets be automatically flagged as suspicious. Industry groups and exchanges have pushed back, saying such reporting rules would create significant operational burdens and could further deter trading and investment.
With the petition now eligible for formal review, the Finance and Economic Planning Committee must consider the objections raised by signatories and stakeholders. Lawmakers and regulators will face pressure to balance tax revenue goals and financial oversight with concerns about competitiveness, investor costs and the future of South Korea’s crypto industry.