South Korean regulators have targeted one of the country’s largest Bitcoin exchanges in the new investigation. According to local reports, the South Korean National Tax Service agency is launching an investigation.
South Korean Bitcoin exchange under scrutiny
According to local reports, South Korea-based Bitcoin exchange Bithumb is under a “special tax investigation” by the country’s National Tax Service (NTS). On January 10, it was reported that tax officials raided the exchange’s headquarters in the country’s capital, Seoul, as part of its compliance investigation. Authorities are investigating the possibility of tax evasion by examining domestic and international transactions by Bithumb Korea, Bithumb Holdings and its affiliates.
Authorities are also investigating possible tax evasion related to Bithumb’s ownership. The investigation was conducted by the 4th Bureau of Investigation of the Seoul Regional Tax Service, which, unlike standard investigations, specifically investigates “special tax investigations”.
cryptocoin.comAs you follow, South Korea recently issued an “investment warning” for WAVES.
Bithumb was previously under a special tax investigation by NTS in 2018
The exchange earned nearly $64 million in income taxes through this investigation. This development comes after former Bithumb chairman Lee Jung-Hoon was acquitted of $70 million fraud charges on January 3.
On December 30, just before the acquittal, Park Mo, one of the directors of Bithumb’s largest shareholder, was found dead. He was under investigation by local authorities for embezzlement and manipulating stock prices. It is suspected that Mo may have taken his own life due to the nature of the charges against him.
The director’s death is the latest in a string of crypto billionaires who died a month apart, including MakerDAO co-founder Nikolai Mushegian and Amber Group co-founder Tiantian Ulder. Some in the community pointed out that these occurred at the same time as FTX’s decline. Regulators around the world have been watching the crypto market closely in light of the turmoil that has plagued the space ever since.
US congress prepares for a series of bills that will determine who gets power
A congress held in December featured a number of legislative proposals that would determine which regulators have the main influence over the cryptocurrency market in 2023. Rather than leaving the industry to unelected regulators in the SEC, it was more appropriate for Congress to decide. To that end, representatives from both sides of the aisle passed bills designed to offer “regulatory clarity.” The moderate position seems to favor placing crypto mostly under the jurisdiction of the Commodity Futures Trading Commission (CFTC).
Crypto experts voice one particular recurring criticism: The bill should introduce a clearer definition of securities and commodities. Will digital securities be valued by the Howey test or any other method? The bill does not clarify. The bill also risks being interpreted as a de facto ban on decentralized finance (DeFi).
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