Key Takeaways
South Korean tax officials in Jeju City uncovered crypto worth 230 million won from delinquent taxpayers using AI tools and exchange data, joining the nationwide effort to tighten enforcement.
Tax authorities in Jeju City, the capital of South Korea’s island province, have stepped up their crackdown on tax evasion by targeting crypto holdings.
Following a probe into nearly 3,000 residents with overdue tax bills, officials have begun freezing and seizing Bitcoin [BTC] and other digital assets from dozens of individuals, according to local reports.
Media outlets noted that some delinquents had been “lining their pockets with cryptoassets,” prompting the city to tighten enforcement.
Jeju City officials’ sweeping investigation
The probe focused on individuals with outstanding bills of more than 1 million won (around $719) and relied on cooperation from South Korea’s largest exchanges — Upbit, Bithumb, Coinone, and Korbit.
Through this data, investigators identified 49 residents who collectively held digital assets worth approximately 230 million won ($165,458).
Authorities quickly designated the exchanges as third-party debtors, a legal step that allows them to freeze and seize the assets.
According to officials, the individuals will now be pressed to settle their debts or face liquidation of their crypto holdings.
How did AI act as a catalyst?
To uncover hidden assets more effectively, Jeju City also deployed AI-powered detection tools during the investigation.
Remarking on the same, Tax chief Hwang Tae-hoon noted,
“We will continue to bolster our response to tax evasion to uncover hidden assets like crypto. We will do our best to track down assets belonging to high-value tax delinquents. We will use AI-based information analysis. This will help us boost tax revenues and foster a culture of honest tax payment.”
Jeju’s move reflects a broader national push in South Korea to crack down on unpaid taxes through cryptocurrency seizures.
Hwang Tae-hoon, head of Jeju’s Tax Division, noted that authorities will lean on AI-driven analysis and virtual assets to uncover hidden wealth, secure revenue, and promote a fairer tax culture.
What’s more?
That being said, South Korea has emerged as one of the strictest enforcers in this space, with regulators empowered since 2021 to seize digital assets from delinquent taxpayers.
Similar crackdowns have already taken place in cities like Seoul and Paju, while nationwide efforts led to the confiscation of over $180 million worth of crypto between 2021 and 2022.
Meanwhile, South Korean banks are ramping up crypto and stablecoin initiatives ahead of new legislation, signaling a major shift in regulatory stance.
Thus, with more than 16 million South Koreans now active on crypto exchanges, officials appear determined to keep tightening the net around those seeking to hide assets in digital wallets.
