– South Korean crypto exchange Korbit’s research division found that the reported amount of overseas digital assets to the National Tax Service may be inflated.
– The research suggests that overseas corporations may be holding their crypto assets without being able to distribute them to the market, resulting in artificially pumped up values.
– The total amount of digital assets held by South Korean companies and individuals through foreign accounts is reported to be 131 trillion won ($96 billion).
– The research center estimates that 73% of this amount is owned by 73 corporations, with their holdings likely artificially inflated through high-price trading.
– Regulatory restrictions on domestic companies have led market participants to conduct business overseas, resulting in a potential “national wealth outflow” of at least 10 trillion won.
– Storing crypto assets in overseas accounts may also be linked to possible tax evasion.
Korbit, a South Korean cryptocurrency exchange, has revealed that the reported amount of overseas digital assets held by domestic corporations and individuals may be exaggerated. The research division of Korbit suggests that the reported value of these assets is likely inflated during the reporting process to the National Tax Service. The study indicates that overseas businesses are holding onto their crypto assets without distributing them to the market, particularly after the ICO boom in 2017. The research center argues that if the value of these holdings is evaluated based on market prices artificially created through self-trading, it is inflated compared to the actual value. The National Tax Service estimates that the total value of digital assets held by domestic companies and individuals through foreign accounts amounts to $96 billion, with approximately 73% of this held by 73 corporations. The research center argues that even if the actual value of these corporate holdings is one-tenth of the reported amount, it represents a significant figure that cannot be ignored. The analysis further suggests that regulatory restrictions on domestic companies, which limit transactions and control derivatives, have led market participants to seek opportunities overseas. Consequently, individuals also turn to overseas businesses to meet their needs. The research center suggests that the outflow of assets seeking services that cannot be met domestically is at a minimum of $10 billion, which can be seen as a form of “national wealth outflow” due to irrational regulations. Additionally, the research predicts that domestic investors may be storing their crypto assets in overseas accounts to evade taxes. However, it raises questions about whether these investors would voluntarily report their holdings to the National Tax Service.
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