South Korea’s Largest Crypto Exchange Bithumb Clears Tax Audit
Bithumb Passes South Korean Audit
Bithumb is currently the largest cryptocurrency exchange website in South Korea. As such, it continues to serve as a precedent-setting example for many sectors within the new cryptocurrency and blockchain market within the country. South Korea has thus far been moderately accepting towards the increasing presence of blockchain-based startups and cryptocurrency-funded communities within their own economy.
The flip side of this precedent, however, is that the negative press received by the company exerts a negative influence on both the public and private perceptions of the organizations which Bithumb, in many ways, continues to represent in the regulatory sandbox. The latest challenge to the company was the evasion of charges against it by the South Korean government, as well as its filing of its taxes, something that the company has been accused of not doing properly in the year 2017.
In any case, the recent developments within the company help to characterize a growing governmental acceptance of cryptocurrency as a genuine thing to trade, as well as the foundation for a growing, and largely above-board, sector of the booming South Korean economy. Consequently, the successes of the organization in both beating its charge and filing its taxes are integral to the progression of the industry as an accepted organization relying on cryptocurrencies to make their money.
Tax Evasion Charges
Bithumb was recently charged with tax evasion for 2017. The charge is a significant one, and could have marked a multi-million dollar fine, as well as the potential for prison time for the executives responsible for the violation. The charge came in response to accusations by the government’s Tax Service that the company had failed to report some of their key earnings for the 2017 fiscal year in a timely fashion.
However, the charges against the company were dropped by the responsible government agency. An official report from June 8th of this year found that the company’s charges of tax evasion had been dropped on all counts. In summation, the government found that there was no evidence of intentional or incidental tax evasion efforts on the part of Bithumb.
The government agency responded to questions regarding the company’s charges, saying that no charges “will be pressed” at this time against the exchange.
Exchange Tax Numbers
The evasion of the tax crime charges is not the only interesting element of the government agency’s report regarding the tax status of the massive South Korean cryptocurrency exchange. The government also released the amounts that the company paid, and made brief remarks on the status of the investigation which they undertook.
The company was made to pay $28 million in taxes, and they paid it in won. Though this amount is significant, the government stressed that the high amount is not an indication that the company was guilty of any reporting or filing discrepancy.
The company reported a total profit of 427.5 billion KRW in 2017, which is over 150-times higher than their profit in 2016, which was only 2.5 billion.