S. Korea Seizes Cold-Wallet Crypto, Kazakhstan Tightens AML

South Korea’s National Tax Service (NTS) has stepped up its crypto tax crackdown to include assets stored in cold wallets. Under the National Tax Collection Act, the NTS can conduct home searches, seize hardware and wallets, request exchange data, freeze suspect accounts and liquidate seized crypto at market value. Since 2021, the agency has confiscated over $108 million from more than 14,000 taxpayers, with investor adoption rising from 1.2 million in 2020 to 11 million by mid-2025. Meanwhile, South Korea’s Financial Intelligence Unit has reported a record 37,000 suspicious transaction reports by virtual asset service providers through August 2025, underlining intensifying AML scrutiny. In parallel, Kazakhstan’s Financial Monitoring Agency shut down 130 unlicensed crypto exchanges in 2025 and seized $16.7 million tied to suspected money laundering. The Central Asian nation is introducing stricter identity verification for large crypto moves and exploring state-backed crypto reserves and stablecoin payments. For crypto traders, these combined enforcement drives signal heightened regulatory risks. The expanded crypto tax crackdown in South Korea and tighter AML rules in Kazakhstan raise the threat of asset freezes and forced liquidations, potentially affecting market liquidity and trading strategies.