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Korean Experts Advocate for Global Crypto Info Exchange to Combat Tax EvasionIn a recent event held to discuss the tax regime in South Korea, law professors offered a suggestion to combat tax evasion associated with cryptocurrencies. They proposed the implementation of a global cryptocurrency information exchange system for more effective response measures.Kim Beom-jun, a professor at the University of Seoul Law School, and Kim Seok-hwan, a professor at Kangwon National University Law School, delved into this matter last Friday at the tax administration forum that took place at the Korea Federation of Small and Medium-sized Enterprises (KBIZ).Photo by Karolina Grabowska on PexelsRising crypto adoptionAccording to their report, the cryptocurrency market is currently facing challenges stemming from the Terra-Luna incident and the broader economic downturn caused by rising interest rates and inflation. However, it’s worth noting that in Korea alone, there are approximately 6.27 million cryptocurrency exchange users, with a collective market capitalization of around KRW 19.4 trillion ($14.6 billion). This suggests that cryptocurrencies continue to integrate into our everyday lives.Crypto tax starting in 2025Starting in 2025, South Korea is set to impose taxes on income from cryptocurrency trading. However, before the tax is put into effect, there is a pressing need for administrative enhancements aimed at preventing tax evasion involving cryptocurrencies. These initiatives encompass the development of crypto-tracking technology and the allocation of sufficient staff and budgets to enable tax authorities to effectively address crypto-related issues.Foreign exchanges and DeFi platformsDuring the forum, experts voiced concerns about the possibility of tax evasion through the use of overseas crypto exchanges and decentralized platforms.Tax specialists pointed out that it’s difficult to expect people to fully meet their tax obligations when they’re trading on international exchanges. They also emphasized the challenges in collecting accurate tax information from crypto users who report transactions in overseas financial accounts.OECD’s initiativeIn August 2022, the Organization for Economic Co-operation and Development (OECD) gave the greenlight to the Crypto-Asset Reporting Framework (CARF). This framework aims to standardize the reporting of tax information related to crypto-asset transactions and facilitate the automatic exchange of such information. During the forum, researchers proposed that in the future, if Korea decides to participate in the OECD’s CARF, it should not only establish a cooperative system between virtual asset service providers (VASPs) and regulatory authorities but also revisit and amend pertinent laws.Additionally, presenters at the forum underlined the necessity of obligating taxpayers to furnish essential tax information for effective virtual asset taxation. They also stressed the importance of implementing appropriate sanctions in cases where taxpayers fail to comply with these reporting requirements.Commissioner Kim Chang-ki of the National Tax Service (NTS) stated that the agency is committed to enhancing tax accountability and transparency. He added that the NTS will take strong measures against malicious tax evasion activities, especially those involving online platforms.Furthermore, Commissioner Kim mentioned that the tax agency is boosting its investigative capabilities using scientific methods to combat emerging forms of tax evasion, like those related to virtual assets. He also said the NTS is expanding its international collaboration and devising other measures.

LightLink, the Singapore-based Layer 2 startup, has recently clinched $4.5 million in seed funding, spearheaded primarily by Asian investors. A strategic alliance has also been forged between LightLink and Animoca Brands, a trailblazer in digital property rights within the open metaverse and gaming sectors.Photo by cottonbro studio on PexelsThai-led fundingT&B Media Global, a prominent Thai media entity, and MQDC, a Bangkok-headquartered real estate developer, led the funding round, which amounted to $4.5 million. In addition to T&B Media Global and MQDC, the seed round saw participation from more notable investors within the Asia Pacific (APAC) and Oceania regions, such as digital asset-focused Australian investment manager JellyC, Aweh Ventures, Singapore’s Blue7 and Australian Web3 venture capital fund B3V. While the capital funding is early stage and lower end from a dollar amount perspective, the broad spectrum of investors underscores a certain level of excitement surrounding LightLink's innovative product offering. The startup’s product offering enables enterprises and decentralized applications to conduct gasless, real-time user transactions within the Ethereum ecosystem through the use of optimistic rollups within LightLink’s established architecture. The infusion of funds will be used to bolster LightLink's efforts to further develop a groundbreaking "multiverse project" dubbed Translucia, a venture that attempts to seamlessly merge virtual and physical realms. Dr. Jwanwat Ahriyavraromp, founder and CEO of T&B Media Global, lauded the partnership, citing a shared vision to cultivate a harmonious and interconnected digital universe that radiates joy worldwide. Animoca collaborationNews of this funding infusion comes off the back of LightLink’s announcement last month of a collaboration with Web3 firm Animoca Brands. This collaboration will witness Animoca integrating LightLink's Ethereum Layer 2 technology into select initiatives, accompanied by advisory support to bolster LightLink's tokenomics strategies and market outreach. The synergy between these entities provides great potential for the delivery of a more seamless Web3 experience, eliminating transaction fees and streamlining blockchain integration for users. LightLink's Ethereum Layer 2 blockchain offers a host of benefits, enabling gasless transactions and frictionless transfers of assets within a public blockchain environment. Its utilization extends to over 25 affiliates, including notable entities like Grapes and The Red Village, with integration into the Translucia project underway. Roy Hui, co-founder and CEO of LightLink, expressed optimism about the partnership's potential to democratize blockchain technology, fostering global connectivity and enabling diverse communities to embrace decentralized solutions. Yat Siu, executive chairman and co-founder of Animoca Brands, echoed this sentiment, emphasizing the alignment between LightLink's gasless transactions and their mission to decentralize the digital realm. Pellar Technologies, the development powerhouse behind LightLink, boasts a track record of over 50 blockchain projects across the APAC region since 2017. LightLink itself ranks among the top 10 in transaction volumes among rollups, boasting over 215,000 unique wallet addresses operating on-chain. Hui reiterated LightLink's commitment to simplifying blockchain adoption. Using the seed funding announcement as an opportunity to set out the firm’s primary objective, he stated:”Our aim is to bridge the digital economy with millions of users across the globe. The funding we've received enhances our focus on making blockchain as intuitive as traditional web platforms, with an emphasis on gasless transactions.” The seed funding marks a significant milestone in LightLink's journey, propelling it towards playing its part in the further roll-out of Web3 innovation.  

Japan appears to be gearing up for the potential launch of its central bank digital currency (CBDC), the digital yen, as the government and the Bank of Japan (BoJ) collaboratively lay the legislative foundation for its rollout. While neither the BoJ nor the government has officially committed to the CBDC launch, recent developments indicate an accelerated push for its development. The BoJ's heightened focus on digital yen comes amidst concerns about falling behind China's and Europe's rapid progress in the CBDC space.Photo by Wenhao Ji on UnsplashOvercoming legal issuesAccording to a report by Japanese media outlet NHK, in a recent meeting, the Japanese government and the BoJ discussed future tasks and legal issues related to its CBDC implementation. To ensure a smooth and legally unobstructed launch, Tokyo aims to establish the necessary legal framework well in advance. Local news media Coinpost reported that the proposed legislation is set to "assume the introduction of the digital yen" and may involve amendments to key laws such as the Bank of Japan Act, the Criminal Code and the Civil Code. The goal is to finalize the list of required legal amendments by spring of the current year. In a meeting between Japan's central bank and the Finance Ministry, executives from relevant ministries and central bank directors explored various aspects of the CBDC. Discussions included the collaboration between a potential central bank digital currency and private cashless businesses, with a focus on convenience and personal data protection. Finance Ministry keen on launch ASAPLast month, the central bank received a report from a Ministry of Finance expert panel which recommended the launch of the digital yen without delay. The Ministry of Finance's December meeting addressed the division of roles between the Bank of Japan and intermediary banks, proposing a "two-tiered model" where domestic commercial banks play a pivotal role in digital yen issuance. Acting as intermediary institutions, these banks will bridge the gap between the central bank and digital yen users. The government and the BoJ are also contemplating ways to involve private businesses in the CBDC project while ensuring fair competition. Security and data privacy considerationsKey considerations in the discussions involve interoperability with other payment methods, ensuring security and handling user information safely. There is also an exploration of potential cross-border payment options. The government and the BoJ are committed to a comprehensive approach that considers various aspects of the CBDC project. Japan's unique context in the CBDC landscape is highlighted, with its continued reliance on cash and the presence of multiple private-sector tokenized money initiatives. Notably, the country boasts over 100 institutions and enterprises exploring digital currency through a digital currency forum since 2020. Separate initiatives, such as the MUFG-backed Progmat DLT platform, contribute to Japan's diverse digital currency landscape. Providing another example of progression in the digital assets arena, it emerged in September that the country is looking to permit startups to raise capital from venture capital firms using digital tokens rather than traditional equity.