Cryptocurrencies such as Bitcoin have no intrinsic value, and their price swings are expected to experience greater volatility, the head of the Bank of Korea (BOK) said Tuesday. “There is no intrinsic value in crypto assets,” BOK Gov. Lee Ju-yeol told lawmakers. Asked by a lawmaker about whether a recent surge in the price of Bitcoin is temporary, the bank’s chief replied, “It is very difficult to predict the price, but its price will be extremely volatile.”
Bank of Korea’s chief is not alone in thinking crypto has no intrinsic value.
Regulators worldwide are taking the crypto industry more seriously than ever before, following bitcoin’s massive winning rally and the growing industry’s mainstream exposure. Bank of Korea’s chief thinks cryptocurrencies have no intrinsic value and are extremely volatile. A recent rally in Bitcoin may be a result of multiple factors, including mass purchases by Elon Musk’s Tesla Inc. and plans by institutional investors to use the digital token as a hedge, Lee said.
South Korea to implement crypto tax starting 2022.
South Korea will implement a 20% tax on cryptocurrency profits starting January 1, 2022. The nation’s Ministry of Economic and Finance announced that profits made from trading and holding cryptocurrencies would be subject to the tax, reported the Korean Herald on Monday. The 20% crypto tax will be triggered when profits made from cryptocurrencies exceed 2.5 million won, or roughly $2,300. Gains made up to this point will be tax-exempt. The government previously wanted to levy the crypto tax starting in 2020, but pushback from cryptocurrency enthusiasts and lobbyists saw the government delay implementing the tax several times.