Bitcoin taxes in South Korea, regulated Crypto firms in Canada and Coinbase as biggest ‘exchange whale’
South Korea to Start Taxing Bitcoin Profits in 2021
South Korea will start taxing profits from bitcoin (BTC) and other cryptocurrencies next year, according to local media reports.
“We are reviewing capital gains tax or other income tax on profits gained by domestic and foreign investors in the transfer of virtual assets,” — the Ministry of Strategy and Finance
The taxation will also apply to bitcoin mining operations and income from initial coin offerings.
South Korea’s Ministry of Economy and Finance proposed the amendments to the existing tax law to include the cryptocurrency industry, with backing from the Ministry of Information and Technology.
These new ruling is not fully watertight, a local researcher explained:
“If you do business through a peer-to-peer transaction without going through an exchange, there is a possibility of avoiding taxation. Even with IP tracking, if there are a large number of targets, administrative costs will increase and it will be difficult to track each day.”
Cryptocurrency Firms Now Recognized as Money Service Businesses in Canada
Since the first of June, Canadian firms operating with virtual currencies will be legally recognized as Money Service Businesses.
Candian crypto firms must now report all transactions exceeding 10,000 Canadian dollars ($7,403), and register and comply with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).
Francis Pouliot, the CEO of Canadian crypto asset exchange BullBitcoin, tweeted the following regarding the news:
Pouliot also notes that the new regulations will predominantly affect cash-based businesses such as Bitcoin ATM operators.
He adds that “most Bitcoin businesses already had KYC measures in place […] because they were required to do so by their banking or payment processing partners.”
Coinbase is the largest bitcoin holder among exchanges
The beauty of Bitcoin is the possibility to store your BTC without the need of a third party (like a bank). However, cryptocurrency exchanges hold around 3.08 million bitcoins on their customers’ behalf. This is nearly 16.5% of the total supply of 21 million.
This amount is down by 10% since the 9th of Februari. At that time exchanges held around 3.43 million bitcoins, representing nearly 19% of the total supply.
Notably, Coinbase is the largest bitcoin holder, having around 984,300 BTC in its wallets. Followed by crypto exchange Huobi (with 413,000 BTC), Binance (318,000 BTC), OKEx (268,000 BTC), and BitMEX (217,000 BTC).
Source: The Block Crypto
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