US Crypto Tax Overhaul Push Offers Clues for Korea’s Debate on Delaying Digital-Asset Taxes - bloomingbit

The Blockchain Association, one of Washington's leading crypto lobbying groups, has urged congressional leaders to modernize US digital-asset tax rules, arguing that the current framework does not reflect how cryptocurrencies work and is adding to taxpayer uncertainty. According to the industry on October 22, the group sent its letter that day to Senate Republican Leader John Thune, Senate Democratic Leader Chuck Schumer and House Speaker Mike Johnson. The association said about 67 million Americans own and use digital assets, but the rules governing them were written for a different era. It warned that without a tax framework that is clear, enforceable, technology-neutral and aligned with economic reality, congressional efforts to establish clear digital-asset rules cannot fully succeed.

A central proposal is to tax mining and staking rewards when the assets are disposed of rather than when they are received. The group argues that a tax liability can arise on staking rewards before any income has actually been realized if the tokens have not been sold. The letter also calls for taxation based on economic substance, excluding transactions that do not change beneficial ownership, such as moving assets from an exchange to a personal wallet or transferring assets across blockchain networks. It further proposes exempting small transactions to make digital assets more practical as a payment method, and treating stablecoins as cash-equivalent assets. The association argues that taxing every stablecoin use for payments or collateral would excessively raise transaction costs and administrative burdens.

The proposals carry implications for South Korea, where debate is intensifying over delaying crypto taxation planned for next year. Standards for transaction types, including staking and airdrops, have not been properly established, and the Ministry of Economy and Finance and the National Tax Service have yet to properly calculate expected revenue and collection costs. The legal status of stablecoins also remains unclear because the proposed Digital Asset Basic Act has not been enacted. Persistent calls exist to raise the basic deduction for digital-asset income from the current 2.5 million won a year. A report commissioned by the National Tax Service in the first half of this year, prepared by Changwon National University's industry-academic cooperation foundation, said keeping the deduction at that level could mean tax revenue is not significant relative to enforcement costs. The Korea Institute of Public Finance also proposed a higher deduction at a symposium last month.

The association has also warned that inadequate tax infrastructure could drive investment overseas, saying the current US regime risks pushing American innovation abroad. In South Korea, Web3 research firm Tiger Research estimated that if crypto taxation takes effect, annual trading volume at Upbit, Bithumb and Coinone could shrink nearly 30% next year, to about 602 trillion won from about 860 trillion won this year, as investor funds move abroad.