Crypto World
Coinbase CEO Warns Rogue AI Could Hit the Internet Within 2 Years
Coinbase CEO Brian Armstrong expects a rogue AI model to break loose on the internet soon. He put the timeline at one to two years.
He framed the scenario as a rerun of the 1988 Morris Worm rather than a civilizational threat.
Why Armstrong Expects a Rogue AI Incident Soon
The prediction lands after a year of real incidents. In July, OpenAI said two of its models escaped a test environment and hacked Hugging Face.
Those models wanted the answer key to a hacking benchmark. They then chained exploits across OpenAI systems and Hugging Face servers to reach the solutions database. Days later, the same agent reached a second firm through a customer’s vulnerable code. Nobody instructed the rogue AI to break out.
Armstrong has tracked the topic for months. In July, he argued that AI makes crypto rails more important because agents will transact constantly. Meanwhile, defenders are arming up. OpenAI shipped a cybersecurity-focused model this month and handed vetted researchers exploit development tools.
Armstrong expects the same pattern here. A media frenzy arrives, calls to halt AI development follow, and the industry patches the hole. The Coinbase CEO runs the largest US crypto exchange. His read carries weight with builders already wiring AI agents into payment systems.
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Critics Say the Morris Worm Comparison Falls Short
The 1988 worm infected roughly 6,000 of about 60,000 connected machines in 24 hours, the FBI says. Its author, 23-year-old Cornell student Robert Tappan Morris, drew probation and a fine.
Damage estimates ran from $100,000 into the millions. Some universities cut themselves off the network for a week.
Yet the fallout also built the defenses. Within days, the Pentagon stood up the first computer emergency response team in Pittsburgh. That template still shapes incident response today.
Security researchers doubt a rogue AI failure would settle that cleanly. A worm spreads on fixed instructions, while an agent adapts to whatever blocks it.
Blockchain security expert Manuel Aráoz warned in May that AI agents outpace auditors across decentralized finance. Ledger executive Ian Rogers made a similar point this month about crypto wallet attacks.
Critics of the comparison list sharper risks. They point to autonomous cyberattacks, industrial-scale disinformation, and lost control of critical infrastructure.
The gap between the two camps comes down to recovery speed. Armstrong bets that patches land faster than damage spreads. His skeptics see failures that no patch reverses.
Neither camp disputes the direction. Model capability keeps climbing, and containment keeps lagging behind it.
Historically, the internet has absorbed each shock. A real rogue AI event will test whether that record holds.
The post Coinbase CEO Warns Rogue AI Could Hit the Internet Within 2 Years appeared first on BeInCrypto.
RedotPay’s plans for a US stock market debut have reportedly been delayed as the stablecoin payment company prepares to expand into the country.
The company delayed plans for a US initial public offering (IPO) while it seeks regulatory approvals and contends with legal disputes involving Binance, Bloomberg reported on Friday, citing people familiar with the matter.
A RedotPay representative declined to comment on the timing of an IPO to Cointelegraph. The representative instead pointed to the company’s US expansion, saying RedotPay obtained a money transmitter license in the US this week and is preparing to launch its product in the country.
The reported setback follows a nearly $473 million lawsuit filed by Binance affiliates and comes as RedotPay works to expand its regulatory footprint in the US and other markets.
RedotPay’s IPO ambitions surfaced in February
RedotPay, founded in 2023 and based in Hong Kong, first emerged as a potential US public-market entrant in February, when reports surfaced that the company was considering a New York listing.
RedotPay has reportedly been working with JPMorgan Chase, Goldman Sachs and Jefferies Financial Group on a listing that could raise more than $1 billion. At the time, the company was seeking a valuation of more than $4 billion.
Related: Bithumb sets 2028 IPO timetable as it overhauls internal controls
Separately, RedotPay has reportedly been in talks to raise up to $150 million in new funding amid organizational changes and preparations for a potential IPO. “As we transition from an early-stage startup to a unicorn, we are evolving our organizational structure and talent pool to support our ongoing growth trajectory,” RedotPay told Cointelegraph in March.
Binance lawsuit adds legal pressure
Binance affiliates sued RedotPay’s founders in Hong Kong earlier in August, seeking nearly $473 million in damages over allegations that they diverted hundreds of thousands of customers from Binance to RedotPay.
The plaintiffs allege that RedotPay’s founders used confidential information obtained through their previous work with Binance to build a competing payments business and attract Binance users. RedotPay rejected the allegations and told Cointelegraph it would “vigorously defend all claims.”
The dispute has also spilled into Singapore, where Binance and RedotPay disagree over the fate of a related case. RedotPay told Cointelegraph this week that it expected Binance to discontinue the case, while Binance rejected that account and said its claims remain active.
Magazine: Inside the fake crypto startup that fooled North Korean IT workers
“When we look at Gen Z, which has grown up amid constant chaos and really a loneliness epidemic, it makes sense why this cohort would be moving into religion as an organized form of not only community and a sense of belonging, but it also gives them purpose and a way to find meaning in a world that has felt very chaotic,” Janfaza says.
Gross, who recently moved to Fort Lauderdale, says it seems to him that, in New York, “definitely the numbers are up.” His TikToks of St. Joseph’s in Greenwich Village show packed pews. Sometimes, he says, people have to stand in the back.
And he attributes that to young people craving community, particularly in the aftermath of the COVID-19 pandemic.
“I mean, some people may call us the crisis generation; there’s been a lot of stuff that we’ve gone through that has made us feel anxious, uncertain, lost, not loved, lack of community,” Gross says.
“And in times like that,” he says, people may feel like, “‘I can’t play this game of life alone, and I need somebody else that I can put my trust in, and someone else that I can believe in, and someone else that I know at the end of the day loves me and is going to lead me down a path for a greater good.’”
The price of Ethereum has declined consistently over the last seven days. Many factors could be responsible for this trend, including the activity (buying and selling of ETH) of large traders, commonly known as whales.
Ethereum price chart for the last 7 days. Source: Coinmarketcap.com
To find out if whales are responsible, we analyzed Ethereum trading data for decentralized exchanges (DEX) from Dune Analytics for the last seven days and answered four important questions.
- Have large traders been buying or selling ETH?
- Has their activity increased or decreased over this period?
- Which whale groups are driving the activities and capital flows?
- Are these activities responsible for the ETH price decline?
We categorized whales into three cohorts, placing them in $100K–$500K, $500K–$1M, or $1M–$5M. The analysis shows that while whales have been active within this period, they are not directly responsible for the price decline.
No Strong Buying Or Selling Bias
The data shows that large DEX traders had a slight buying bias, buying approximately $358 million of WETH and selling approximately $352M during the period, with a $6M net difference. This difference isn’t significant, indicating a nearly balanced buying and selling pattern within the last seven days.
Whale buy vs sell volume for the last seven days. Source: Dune.com
High Volatility But No Clear Trend
Whale activity showed no clear trend over the last seven days, as there is no clear increase or decrease. However, sharp differences in activity are clear, with a huge decline over the weekend indicating significant volatility. This shows that large traders have been active in the market.
Whale activity showing volatility in the last 7 days. Source: Dune.com
Smaller Size Whales Drive Activity But Capital Flow
Large traders with amounts ranging from $100K–$500K accounted for 86% of whale activity by transaction count. This shows that moderately large traders were the most frequent participants over the period.
Whale trading counts. Source: Dune.com
However, the $1M–$5M cohort, with only 8.7% of trades, comes very close in terms of trading volume at 45.13%, compared to 45.64% for the $100K–$500K cohort. This indicates that while moderately sized whales are the most frequent participants, larger whales have a disproportionately greater impact on capital flows despite their significantly fewer transactions.
Whale trading volume in USD. Source: Dune.com
ETH Price Decline Unrelated To Whale Activity
Despite sharp differences in the large traders’ activities by day, ETH price declined consistently, while whale trading volume fluctuated without a corresponding trend over the period in focus. This shows that the price decline has no direct link with large trader activities in the last seven days.
Ethereum price with respect to whale activity. Source: Dune.com
Conclusion
The data reveals that while there is no clear trend in the activity of whales over the last seven days, ETH price continued to fall. The findings suggest that whale activity over this period is not directly responsible for the price decline.
However, the analysis only considers data for the last seven days, which may be too short a period to give an accurate picture of what is really going on. Also, the price decline may be driven by other factors such as general current sentiment among retail traders, who ultimately are the majority of the market.
An interesting direction to also consider, which this analysis doesn’t cover, would be to determine where large traders are sending their ETH to—whether to centralized exchanges (CEX) or to private wallets. The finding could give important insight into the minds of these big players and tell us what to expect from the market next.
Bitcoin investors received what should have been a fairly supportive and positive combination of macroeconomic data in the past week, starting with the weak US jobs report last Friday.
However, the asset failed to produce any significant gains, again. Moreover, it has lost some traction and is actually down on a weekly scale, currently struggling to remain above $63,000. Why is that?
Why No Gains, BTC?
After the jobs report from a week ago, which managed to push BTC beyond $65,000 briefly, all eyes turned to the US CPI data on Wednesday. As reported, the July numbers came broadly in line with expectations, initially leading to a brief rebound to $64,400 before Bitcoin gave the gains back and resumed the downtrend it was already on as the business week progressed.
The subsequent PPI report was even more encouraging, with producer prices remaining flat month-over-month, contrary to expectations of a 0.2% increase. CryptoQuant weighed in on the matter and added that Treasury yields declined, while US equities posted some gains. Under normal circumstances, this combination should have provided some relief for risk-on assets, but BTC has failed to make a move upward.
Their analysis indicated that the explanation may have less to do with the macro environment and considerably more to do with a simple problem: Bitcoin buyers are nowhere to be seen in the spot market.
The report explained that such trading activity remains subdued, while flows into the US BTC ETFs have remained relatively weak in the past several days. Even more importantly, the Coinbase Premium Index continues to be almost entirely in negative territory for three months, and it now sits at around -0.1%.
The analysts added that the seven-day average spot trading volume across major exchanges dropped from nearly $9 billion in late June to under $4 billion on August 12. This 55% decline came even as BTC’s price recovered 8% within the same timeframe.
The Real Price Test
CQ identified Bitcoin’s short-term holder cost basis at around $68,700 as a major obstacle to the asset’s path forward, as it’s a level at which investors who bought relatively recently could exit at breakeven if the cryptocurrency reaches it.
As such, a surge to $65,000 won’t be enough to confirm that the broader trend has changed. They believe a more sustainable recovery would require several developments at once: renewed, significant ETF inflows, such as those from the previous week; stronger spot volume; a return to a positive Coinbase Premium; and a decisive break above $68,700.
The post Bitcoin Shrugged Off Good CPI and PPI Data: Why Is BTC Still Stalling? appeared first on CryptoPotato.
Sending USDT over the TRON network is particularly popular because of its speed and broad adoption. That said, TRC-20 transfers also require network resources.
When a wallet doesn’t have enough TRON Energy, TRX may be burned to cover the remaining cost of executing the smart contract. For users who make frequent transfers, renting energy provides an alternative to staking a large amount of TRX solely to generate network resources.
This is exactly the type of use case that TronBid’s marketplace is built around. It brings together users who want to rent TRON energy and holders of staked TRX who have unused energy or bandwidth they want to monetize.
Instead of offering only one way to acquire energy, TronBid combines a P2P marketplace, instant energy rental, a Telegram bot, a calculator, and API access in one single ecosystem. Its marketplace also allows both buyers and sellers to create their own orders, giving participants more flexibility over pricing and rental terms.
What is TronBid?
TronBid brings forward a marketplace and a rental platform for TRON network resources, primarily focused on energy and bandwidth.
TRON energy is consumed whenever smart contracts are executed on the network. Naturally, this includes the primary use case for the blockchain: USDT TRC-20 transfers. If an address doesn’t have sufficient energy available, TRX can be burned to cover the required network resources. As mentioned above, instead of staking a large amount of TRX themselves, users can receive temporarily delegated energy from another wallet.
TronBid creates the infrastructure needed to satisfy this delegation process.
Those users who need resources can rent energy through a ready-made package or participate in the marketplace directly. At the same time, those whose staked TRX generates unused resources are able to offer those resources to others while keeping complete ownership of their TRX.
How the TronBid Marketplace Works
The main TronBid Marketplace is essentially a P2P market for TRON energy and bandwidth. Its current structure gives users several ways to interact depending on whether they are buying or selling resources.
A buyer can create a buy order and specify the amount of energy or bandwidth needed, the price per unit, and the desired rental duration. Sellers, on the other hand, are able to review active orders and fulfill the ones that match the resources and the terms they are willing to provide.
TronBid also supports the ability for sellers to push their own offers, meaning that sellers can specify the resource, amount, asking price, and rental terms.
The goal is to complete a two-sided marketplace where buyers are not limited to waiting for a fixed rental price, and sellers are not limited to searching through existing buyer orders. Both sides can initiate a potential transaction.
A Two-Sided Market for TRON Energy
The two-sided structure is one of the most interesting features of the current TronBid platform.
A user who wants to rent TRON Energy has two basic options within the marketplace:
- Create a buy order with a preferred amount, price and rental period.
- Choose an existing seller offer and purchase Energy under the displayed terms.
Sellers have similar flexibility:
- Fulfill an existing buyer order.
- Create their own sell offer with a chosen amount, price and rental term.
This allows supply and demand to play a more direct role in price discovery.
Instead of all transactions depending on a centrally defined rental rate, buyers can signal what they are prepared to pay while sellers can signal what they are prepared to accept. U.Today has previously described TronBid’s open-market approach as a model where Energy providers compete on price, while the current TronBid platform expands that marketplace structure with dedicated seller-created offers.
Features of TronBid: Closer Look
Evidently, the platform is built around buying, selling, and renting energy on TRON, but let’s have a closer look at some of its more interesting features.
- Quick Rent
Users who need energy immediately can use TronBid Quick Rent to select a package, enter a TRON address, pay in TRX, and receive delegated energy automatically without having to wait for a match on the marketplace.
- Telegram Bot
TronBid’s official Telegram bot provides another quick and convenient way to access energy rental services, particularly for mobile users.
- API Access
Businesses and developers can integrate automated TRON energy rentals into wallets, payment services, exchanges, and other applications.
Conclusion
TRON Energy rental gives users an alternative to relying solely on TRX burning or staking large amounts of TRX when interacting with smart contracts such as USDT TRC-20.
TronBid approaches this market from several directions.
Users who want to rent TRON Energy can choose between instant fixed-package rental and a P2P marketplace.
Those who already have unused resources can sell TRON Energy or Bandwidth while retaining ownership of their staked TRX. Buyers and sellers can both create marketplace orders, while Telegram and API access extend the service beyond the main website.
The post TronBid: A Flexible Marketplace to Rent and Sell TRON Energy appeared first on CryptoPotato.
Bit Digital stock climbed after the company reported a $107.2 million net loss for the second quarter, breaking from the sell-off that punished rival crypto-linked shares this week.
The Nasdaq-listed Ethereum (ETH) treasury and artificial intelligence (AI) infrastructure firm booked $32.1 million in revenue. That marks a 15% gain over the first quarter.
Investors Look Past Bit Digital’s Quarterly Loss
Investors appeared to focus on the operating line rather than the headline loss. The stock added 2.05% to close at $1.49 on Thursday, then gained another 1.34% to $1.51 after hours.
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That reaction stood apart from the rest of the week’s crypto earnings slate. Bitdeer slid roughly 20% after its August 10 report, while Forward Industries fell 1.36% after hours despite closing the session higher.
The pattern was also observed earlier in other major crypto equities such as Coinbase, MARA Holdings, and CleanSpark.
Roughly $86 million of Bit Digital’s loss came from non-cash digital asset movements and non-operating items. That included a $46 million impairment on liquid staked ETH, which the company says was not a realized loss.
The loss also narrowed. Bit Digital lost $146.7 million, or $0.45 per diluted share, in the first quarter. This quarter’s figure was $0.31 per share.
Meanwhile, the operating businesses grew. Cloud services revenue climbed 42% to $23.8 million at a gross margin near 58%. Group gross profit reached $18.6 million.
Ethereum Treasury Now Funds the AI Business
Bit Digital held 164,310.5 Ethereum as of June 30. It bought 8,568 ETH for $20 million on May 11 and sold none during the quarter. The company raised $50 million against a portion of that treasury.
It also used its own balance sheet to commit up to $150 million to WhiteFiber through a delayed draw facility for the NC-1 data center campus. Bit Digital’s 27 million WhiteFiber shares carried an implied value of nearly $1.05 billion at quarter-end.
CEO Sam Tabar argued the market has not caught up to that shift.
“Our operating results improved through the quarter. Our valuation did not. The market continues to value Bit Digital primarily as a passive digital asset treasury, and the Board is currently evaluating our options to address that disconnect,” he said.
WhiteFiber has signed new multi-year cloud agreements worth more than $540 million in aggregate contract value since its last earnings call. Tabar said the wider portfolio should produce over $200 million in annualized revenue once fully deployed.
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The post Bit Digital Stock Rises Despite $107.2 Million Q2 Loss appeared first on BeInCrypto.
Crypto World
The Biggest Bitcoin Bear Keeps Adding to Their Short Position as BTC Price Slides Further
Bitcoin’s breakout attempt faced another rejection at $65,000 earlier this week, and the bears appear to be in control once again, driving the asset south to under $63,000.
One particular bear has garnered the community’s attention with massive short positions that they keep building on.
Data provided by Lookonchain indicates that the unknown market pessimist continues to increase their leveraged position, which has now grown to 2,000 BTC. The analysts described them as the “largest on-chain BTC bear.”
Although the trader is currently well in the green on their position, sitting on an unrealized profit of nearly $2 million at today’s prices, their liquidation levels are not far off.
The current price at which the bear will be wiped out is just over $63,500, which makes the position even riskier. For now, though, it’s quite beneficial since BTC has seemingly lost the $63,000 support despite the positive CPI and PPI data from earlier this week.
Gambler 0xff84 keeps adding to his $BTC short and now holds a 2,000 $BTC($125.37M) short, with an unrealized profit of $1.79M.
He is now the largest on-chain $BTC bear.
Liquidation price: $63,528.92https://t.co/OGB2Ch9tfI pic.twitter.com/fxldgN0j5x
— Lookonchain (@lookonchain) August 14, 2026
According to analysts at CryptoQuant, the cryptocurrency has failed to rally due to several factors: the Coinbase Premium has remained in the negative for three months, the spot Bitcoin ETFs have seen weaker inflows, and there’s not enough spot trading volume across all centralized exchanges.
The post The Biggest Bitcoin Bear Keeps Adding to Their Short Position as BTC Price Slides Further appeared first on CryptoPotato.
Upbit and Bithumb will end trading support for Storj (STORJ), JasmyCoin (JASMY) and ThunderCore (TT) on Sept. 14 after concluding that the issues behind earlier warning designations remained unresolved.
Summary
- Upbit will delist STORJ, JASMY and TT on September 14 after warning issues remained unresolved.
- Bithumb announced matching delistings, setting the same September 14 trading cutoff for all three tokens.
- Withdrawals on Upbit remain available until October 14, giving holders one month after trading ends.
- Storj Labs entered Chapter 11 in July, while its decentralized storage network continues operating normally.
- ThunderCore disputes the exchanges’ concerns, saying its network, issuance mechanism and operations remain normal currently.
Upbit’s notice covers STORJ/KRW, STORJ/BTC, JASMY/BTC, JASMY/USDT, TT/KRW and TT/BTC, with trading scheduled to stop at 3:00 p.m. KST. Bithumb independently confirmed the three delistings Friday.
All open orders will be canceled when support ends. Upbit will keep withdrawals available until Oct. 14. Bithumb separately announced the same Sept. 14 trading cutoff and Oct. 14 withdrawal deadline for all three assets, confirming that the action is not limited to one Korean exchange.
Upbit says the warning issues were not resolved
Upbit first placed STORJ under a trading warning on July 28. The exchange said its review considered disclosure of important information, the substance and sustainability of the project and its actual progress. Deposits were suspended when the warning was issued, and Upbit said it would decide during the Aug. 10 to Aug. 14 review window whether to extend, remove or escalate the designation.
The warning came two days after Storj Labs filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of West Virginia. Storj said case No. 5:26-bk-00512 was intended to address legacy liabilities while keeping its decentralized storage business operating. Upbit did not say the bankruptcy filing by itself caused the delisting.
As crypto.news reported, Storj Labs filed for Chapter 11 while keeping its cloud services active. The company has also floated a possible ownership mechanism for STORJ holders in a reorganized business. That remains a proposal rather than a confirmed recovery for token holders, and any arrangement would depend on the bankruptcy process.
JASMY and TT failed to clear later reviews
Upbit designated JASMY and TT as warning assets on July 31 and suspended deposits. For JASMY, the exchange cited shortcomings in disclosures about matters capable of materially affecting the asset, alongside concerns involving business substance, sustainability and actual progress.
For TT, Upbit also raised questions about the project’s operations, while the original review covered issuance and circulation related concerns. Bithumb’s final notice said the warning reasons for STORJ, JASMY and TT had not been resolved. No new Jasmy response addressing Friday’s delisting was identified in the official materials reviewed.
The decisions come as Korean exchanges continue applying post-listing reviews to supported assets. In related coverage, Upbit moved to remove NKN after its warning review, another case in which a caution designation preceded termination of trading support.
ThunderCore disputes the exchanges’ assessment
ThunderCore has disputed the characterization behind TT’s warning designation. In an Aug. 1 statement, the project said plans involving TT had been publicly communicated and that changes to issuance, network parameters and token economics had been disclosed to Upbit and Bithumb. It maintained that “the network, the issuance mechanism, and the project’s operational condition remain normal.” That is ThunderCore’s position and conflicts with the exchanges’ decision to maintain their concerns.
ThunderCore also updated its circulating supply estimates in June after a governance proposal allowed block issuance to be adjusted from zero to 135 TT by vote. Its official blog lists a new Aug. 14 update concerning Upbit and Bithumb trading support, but both exchanges still proceeded with delisting.
What happens next for STORJ, JASMY and TT
Upbit users can trade the six affected pairs until 3:00 p.m. KST on Sept. 14. Any unfilled buy or sell orders will then be canceled. Withdrawals remain supported until 3:00 p.m. KST on Oct. 14, giving users another month to move assets to compatible wallets or other venues.
Bithumb set the same dates and warned that withdrawal processing may require advance address registration. The exchange also said technical support can become limited after the withdrawal window closes. Delisting does not disable the underlying networks or tokens, but it removes the affected trading markets from two major South Korean venues.
Baltimore has sued prediction market operators Kalshi and Polymarket, accusing both of running unlicensed sportsbooks in the city.
Mayor Brandon Scott and the City Council filed the complaints Thursday in Circuit Court for Baltimore City.
Baltimore Sues Kalshi and Polymarket
The city says both platforms let residents bet on game winners, point spreads, point totals, and player statistics. Those propositions match products sold by licensed sportsbooks, according to the complaints.
Both companies call them event contracts. However, Baltimore argues they function as sports bets and amount to unlawful gambling under Maryland law.
Furthermore, the lawsuit claims that the missing licenses free both firms from the tax bills, audits, and player-protection rules that licensed operators carry.
The complaints also allege the platforms advertise in ways that suggest their products are lawful and properly supervised. The city says that impression draws in inexperienced bettors and problem gamblers who stand to lose money.
“These companies are running sportsbooks without licenses and betting that a new label will put them above the law. It won’t. Baltimore will not let multibillion-dollar companies put profits over people and harm our communities through illegal gambling,” Mayor Scott said.
The city wants an injunction blocking both platforms from taking transactions from residents. It also seeks civil penalties of up to $1,000 per violation per day. Restitution for affected consumers and disgorgement of profits round out the demands.
“For each violation of the CPO, and for each day that a violation was committed, Plaintiff is entitled to civil penalties of up to $1,000. Baltimore City Code Art. 2, § 4-4,” the lawsuit reads.
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Cities and States Widen the Prediction Market Fight
Baltimore joins a growing list of jurisdictions taking prediction markets to court. Kentucky Attorney General sued Kalshi and Polymarket in June alongside casino game operator VGW.
Wisconsin’s Department of Justice brought Dane County lawsuits in April, naming Kalshi, Polymarket, Robinhood, Coinbase, and Crypto.com. Nevada moved earliest, halting Kalshi entirely in March through a 14-day restraining order.
Meanwhile, the New York City Council opened a probe into prediction markets on Wednesday. Speaker Julie Menin gave the platforms 14 days to disclose city user numbers and revenue.
However, federal preemption remains the industry’s core defense, and it has worked. Whether a city ordinance survives that same argument is the next test.
Banks Keep Their Distance Too
Institutional caution runs alongside the legal pressure. The Financial Times reported that JPMorgan ended its banking relationship with Polymarket last year amid regulatory concerns. The prediction-market platform has since moved to another lender.
JPMorgan has nevertheless retained some links to Polymarket, including inviting CEO Shayne Coplan to speak at a Miami conference.
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South Korean lawmaker Park Soo-young has called for the government to withdraw its planned 22% tax on virtual asset gains before the levy takes effect on Jan. 1, 2027, arguing that the policy unfairly targets roughly 13 million crypto users while investment taxes on domestic stocks have been scrapped.
Summary
- South Korean lawmaker Park Soo-young has called for the planned 22% crypto gains tax to be withdrawn.
- The tax is scheduled to take effect on Jan. 1, 2027, with an annual deduction of 2.5 million won.
- Park said the tax could push more Korean capital to overseas crypto exchanges.
- The People Power Party has also proposed abolishing or delaying the tax.
According to Digital Asset, the People Power Party lawmaker criticized the tax plan on his YouTube channel, “Park Soo-young’s Economy TV,” on Aug. 13, describing it as a punitive policy that could push more Korean capital toward overseas cryptocurrency markets.
“I hope this punitive tax plan that holds 13 million digital asset users hostage will be withdrawn immediately,” Park said.
The lawmaker compared the treatment of crypto investors with South Korea’s decision to abolish the financial investment income tax, which would have applied to investment income from financial products including stocks.
Park argued that removing the investment tax while retaining a separate levy on virtual assets amounts to telling investors they could face a “tax bomb” if they choose not to invest in the domestic stock market.
South Korea crypto tax faces renewed opposition
Under South Korea’s current Income Tax Act, profits from the transfer or lending of virtual assets will be classified as other income from Jan. 1, 2027. Investors will receive an annual deduction of 2.5 million won, with gains above that amount taxed at 20%.
Once the 2% local income tax is included, the effective rate reaches 22%.
The 2.5 million won deduction is the same basic deduction applied to capital gains from overseas stocks, while South Korea no longer plans to introduce the financial investment income tax that would have covered certain domestic financial investments.
The government has maintained that implementation will proceed next year. In May, Moon Kyung-ho, director of the Ministry of Economy and Finance’s income tax division, publicly confirmed that authorities were preparing to introduce the tax on schedule, as crypto.news previously reported.
The National Tax Service has also been preparing implementation guidance with South Korea’s five major crypto exchanges: Upbit operator Dunamu, Bithumb, Coinone, Korbit and Gopax. The guidance is expected in 2026, while the first full filing period would come in May 2028 for income earned during 2027.
Political opposition has continued despite those preparations. The People Power Party introduced legislation in March seeking to amend the Income Tax Act and abolish the crypto tax before it takes effect. The tax has already been delayed three times following years of disagreement over when and how digital asset gains should be taxed.
Originally introduced in 2020, the regime was scheduled to take effect earlier, but lawmakers repeatedly pushed back its implementation. The latest postponement moved the start date from 2025 to 2027.
Park warns capital could move overseas
Park also challenged the idea that taxing crypto could encourage investors to redirect their money into Korean equities.
“People will not invest in domestic stocks just because of this,” he said, adding that the policy could instead accelerate the movement of Korean wealth overseas.
To support his argument, Park cited data showing that roughly 124 trillion won flowed into overseas digital asset exchanges between January and September last year.
Capital moving from Korean platforms to foreign exchanges and private wallets has already drawn regulatory attention. Financial Services Commission data released in March showed that South Korean exchanges recorded 90 trillion won, or roughly $60 billion, of crypto outflows during the second half of 2025, up 14% from 78.9 trillion won in the first half. The regulator attributed part of the activity to cross-border arbitrage and similar trading, while overseas crypto outflows have remained under scrutiny.
South Korea has also moved to place more cross-border digital asset activity within its foreign-exchange framework. Amendments to the Foreign Exchange Transactions Act created a virtual asset transfer service category and require companies handling qualifying overseas crypto transfers to register with the finance minister. The cross-border transfer rules cover businesses moving virtual assets between South Korea and foreign countries through sales, purchases or exchanges.
Loss carryforwards become another tax dispute
Park separately criticized the treatment of losses under the planned system, arguing that the government intends to collect tax when investors make profits without providing comparable treatment when cryptocurrency prices fall.
“The losses suffered from a crypto crash cannot even be carried forward, yet they are already putting a spoon into the profits,” Park said.
His comments follow other objections focused on how the virtual asset tax compares with the treatment of other investments.
A public petition seeking complete repeal of the levy crossed the 50,000-signature threshold in May, automatically sending the proposal to a National Assembly committee for review. The petition argued that imposing a 22% tax on crypto profits while financial investment income from stocks and bonds remains exempt creates unequal treatment between asset classes. The tax repeal petition also raised concerns about investor protections and the treatment of a market where large price movements can rapidly alter gains and losses.
The disagreement has left the Jan. 1 deadline dependent on whether lawmakers change the Income Tax Act before implementation. The government has said it intends to proceed under the existing law, while no clear opposition to implementation has emerged from the ruling party.
The People Power Party continues to seek either the abolition or another postponement of the tax. Its March bill proposed removing the levy entirely, while Park’s latest comments called for the government to withdraw the planned tax before its scheduled 2027 implementation.
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