Global Crypto Regulations Expand: South Korea Adopts OECD's Crypto Reporting Framework

South Korea has signed a deal with the Organisation for Economic Co-operation and Development (OECD) to adopt a worldwide crypto reporting system, marking a significant shift towards tighter oversight of cross-border crypto trading activity.

The agreement, known as the Crypto-Asset Reporting Framework (CARF), sets up a structure for exchanging tax-related information on digital asset transactions across borders. This initiative aims to strengthen efforts to monitor digital assets globally and reduce anonymous trading, while improving tax transparency worldwide.

Under the new policy, South Korea's leading digital asset exchange, Upbit, along with other local exchanges like Bithumb, will be required to report user data to help track cross-border crypto trades. The government plans to impose crypto taxation starting January 2025.

The shared information will feed into a centralized system managed by the OECD. Partner nations will also upload their own data, allowing cross-border tracking of transactions. Besides South Korea, Germany, the United Kingdom, and Japan will be involved in the future international evaluation of crypto transaction data.

The new rules will require local exchanges to disclose personal and transaction data of users who are citizens of participating countries starting next year. This move is expected to lead to short-term disruptions for exchanges such as Upbit and Bithumb due to increased administrative requirements. Operational costs for crypto exchanges may rise as a result.

It's important to note that this agreement focuses solely on information sharing under international rules and does not directly relate to taxation laws. The Ministry of Economy and Finance aims to develop detailed regulations for CARF through an administrative notice expected later this month.

The policy targets both domestic and foreign activity, collecting transaction data from local crypto exchanges. The initiative is part of South Korea's efforts to keep pace with other countries like Germany, the United Kingdom, and Japan, which are also preparing for the CARF rollout. South Korea will begin recording transaction data for crypto activities in 2026.

International exchange of crypto transaction data between countries is set to begin in 2027. This marks a significant step towards a more transparent and regulated crypto market, as countries work together to combat money laundering, tax evasion, and other illicit activities.

Global Crypto Regulations Expand: South Korea Adopts OECD's Crypto Reporting Framework