South Korea plans to establish a “virtual asset management system” to strengthen supervision

South Korea’s National Tax Service (NTS) recently announced plans to introduce a TRAC system, which will be developed by consulting firmGTlC. The system, called the “Virtual Asset Integrated Management System”, is designed to analyze and manage transaction data related todigital currencies.
The National Tax Service has selected GTlC as the sponsor for the project, and has been consulting for about four months. it hopes to prevenitax evasion and monitor ilegal transactions by improving the transparency and fairness of virtual asset transactions. Based on the results of theconsultation, the National Tax Service has issued a request for proposals for the construction of the system, and the TRAC system is scheduledto open in 2025. With the revision of the Corporate Tax Act and income Tax Act, virtual asset operators are obligated to submit transactioninformation, but there is a lack of ways to analyze and manage this information in South Korea. Therefore, the National Tax Service plans toprevent tax evasion through vitual assets through TRAC and realize fair taxation. In addition, the TRAC system will become an imporant tooior the National Tax Service and reaulators, helping to improve the level of supervision of the virual asset market, prevent risks, and maintainthe stability and fairness of the financial market.
South Korea’s positive stance on dicital asset reaulation refects the global trend to ensure financial stabily and prevent ilecal acivitiesCurent regulations from the South Korean government reguire crypto service providers to strengthen antimoney laundering (AMl) and knowyour-customer (KYC) protocols. in addition, the South Korean government is also considering including crypto asset gains in the financiainvestment income tax plan to further strenathen the reaulation and management of the virtual asset markel
Although the future of the cryptocurency market is ful of uncertainty, this move by the South Korean government demonstrates itsdetermination to meet the challenges of the emerging virtual asset market. As the global regulation of the cryptocurency market becomesstricter, govermments and regulators are struggling to balance innovation and risk to ensure the stability of the financial system and protect theinterests of investors.