South Korea has begun considering a new education tax on cryptocurrency exchanges that could leave major operators such as Upbit and Bithumb paying billions of won annually if they are reclassified as financial businesses under the proposed Digital Asset Basic Act.
Summary
- South Korea is considering imposing an education tax on cryptocurrency exchanges if they are classified as financial businesses under the proposed Digital Asset Basic Act.
- Government officials recently discussed the proposal with domestic crypto exchange executives, although no final decision has been made on the new tax obligations.
- Financial institutions currently pay an education tax of 0.5% on taxable revenue up to 1 trillion won and 1% on amounts exceeding that threshold, even if they report losses.
- Based on 2025 operating revenue, Dunamu, which operates Upbit, could face an estimated 10.2 billion won education tax bill, while Bithumb could pay around 3.2 billion won.
According to an October 26 report by Seoul Economic Daily, government officials recently raised the possibility during discussions with chief executives of domestic cryptocurrency exchanges, as authorities continue working on legislation that would bring digital asset businesses under a more comprehensive regulatory framework.
The government is now considering whether crypto exchanges should pay the same education tax as banks, insurers, and securities firms if they are officially recognized as financial businesses.
A senior government official told industry representatives that if crypto exchanges are classified as financial businesses, the government would need to consider whether they should pay the education tax.
The official explained that when South Korea first developed its cryptocurrency regulatory approach in 2018, exchanges were not placed within the financial industry. Authorities now need to discuss whether that classification should change as the government prepares new legislation.
Crypto exchanges could face taxes on operating revenue
In South Korea, cryptocurrency trading and brokerage services are currently treated as information and communications businesses, so exchanges are exempt from the education tax that banks and other financial firms have to pay.
However, this could change if the Digital Asset Basic Act recognizes crypto exchanges as financial businesses and the government updates the existing classification and tax rules.
Currently, financial institutions in South Korea pay an education tax based on their operating revenue. The tax rate is 0.5% on taxable revenue of up to 1 trillion won and 1% on amounts above that level.
Unlike corporate income tax, which is based on profits, the education tax is calculated using revenue. This means financial companies still have to pay the tax even if they end up reporting a loss.
If the same rules are applied to crypto exchanges, they would have to pay the education tax on their taxable revenue, regardless of how much profit they make after covering their operating expenses.
According to an analysis of financial statements from South Korea’s five largest crypto exchanges by Seoul Economic Daily, Dunamu, the operator of Upbit, generated 1.5212 trillion won in operating revenue in 2025.
Bithumb came second with roughly 651.3 billion won, followed by Coinone at 45.4 billion won. Meanwhile, DigitalX and Gopax reported operating revenue of 9.7 billion won and 4.3 billion won, respectively.
Based on the current education tax rates for financial institutions, the report estimated that Dunamu could have to pay around 10.2 billion won annually, while Bithumb could face a tax bill of approximately 3.2 billion won.
However, the estimates assume that crypto exchanges will be required to pay the education tax and that their trading fees will be exempt from value-added tax. The final amounts could differ depending on which types of revenue are taxed and what exemptions are allowed under the new rules.
Digital Asset Basic Act remains under discussion
Meanwhile, the education tax proposal has surfaced as South Korean regulators work toward completing the country’s second-stage cryptocurrency legislation.
As crypto.news previously reported, Financial Services Commission Chairman Lee Eog-weon told lawmakers on October 22 that government consultations over the Digital Asset Basic Act were nearing completion.
However, authorities have yet to announce a formal date for submitting the legislation, with several provisions concerning cryptocurrency exchange supervision and stablecoin issuance still being discussed.
Earlier in September, the FSC had targeted a November review by a National Assembly subcommittee as part of efforts to advance the country’s next phase of digital asset regulation.
The proposed legislation is expected to build on South Korea’s existing Virtual Asset User Protection Act, which introduced safeguards for cryptocurrency investors and requirements governing exchange operations.
Among the outstanding questions are how digital asset service providers should be licensed, how exchanges should be supervised, and which institutions should be permitted to issue won-denominated stablecoins.
South Korea faces separate debate over crypto gains tax
The discussion over taxing cryptocurrency exchanges comes as South Korea is considering another postponement of its long-delayed tax on digital asset investment gains.
Under the current schedule, qualifying annual cryptocurrency gains exceeding 2.5 million won would face a combined 22% tax beginning January 1, 2027.
However, the presidential office has backed another tax delay, with ruling-party lawmakers proposing to move implementation to 2029 amid concerns about incomplete preparations and difficulties tracking overseas transactions.
The proposed education tax is separate from the investment gains tax, as it would apply to the operating revenue of cryptocurrency businesses instead of profits earned by individual investors.
South Korea’s National Tax Service has meanwhile continued preparing the existing investor tax framework, including guidelines covering cryptocurrency transactions that are expected to be published in November.
The guidance is expected to address the treatment of income from staking rewards, airdrops, hard forks, and decentralized finance activities, which have remained among the areas requiring clarification before the scheduled implementation.
