South Korea FSC’s Crypto Policy Ranks Near Bottom in Self-Review as Tax Preparations Stay on Track

South Korea’s Financial Services Commission ranked near the bottom in an internal government performance review for two of its main virtual-asset policy initiatives.

Edaily reported on September 1 that the FSC’s “2025 Internal Evaluation Results Report” for major policies rated its task of drafting a second-phase virtual-asset law as “somewhat insufficient” and its task of establishing a stablecoin regulatory framework as “insufficient.”

The review covered 31 management tasks carried out last year by 15 FSC divisions and teams. The FSC appointed current and former members of the Financial Development Review Committee as evaluators. They assessed each task on the appropriateness of planning, achievement of results and policy effectiveness, assigning grades on a seven-level scale from “very excellent” to “poor.”

The second-phase virtual-asset law initiative received a fifth-grade rating, while the stablecoin framework received a sixth-grade rating. Of the 31 tasks, 10 were rated “somewhat insufficient” or worse, placing both crypto-related initiatives in the lower tier.

The legislative timetable has also slipped from the original plan. The government is pursuing the institutionalization of digital assets, including stablecoins, as a national policy task, but the FSC’s bill has yet to be submitted to the National Assembly. Its target of completing legislation in the first quarter of this year has already been missed.

The FSC said in the report that consultations with related agencies, including the Bank of Korea, took longer than planned because the new framework would affect foreign exchange, monetary policy, and payment and settlement systems. That pushed back the timing for meeting the original policy targets.

At the National Assembly, 10 bills on digital assets and stablecoins proposed by both ruling and opposition lawmakers remain pending, starting with a bill introduced in June 2025 by Min Byung-dug of the Democratic Party. Key issues also remain unresolved, including a “bank-centered 50% plus one share consortium” model for stablecoin issuers and limits on major shareholders’ stakes in crypto exchanges.

Preparations for taxing virtual assets, by contrast, are moving ahead on schedule. The Ministry of Economy and Finance is sticking to its plan to begin taxing virtual assets in January 2027, and did not include any additional delay or related revisions in next year’s tax law amendment bill.

The Cabinet on September 1 reviewed and approved the government’s tax overhaul bill without a separate amendment on virtual-asset taxation. The National Tax Service also held a meeting of its advisory panel on September 24, 2026, to establish a public notice for virtual-asset taxation and is working on detailed tax standards.

As debate over a basic law to establish a broader regulatory framework for the digital-asset market continues to lag, the January 2027 start date for virtual-asset taxation under current law is drawing closer. Attention is now focused on how quickly lawmakers can move on the basic law and how fast tax authorities can finalize taxation standards.