- NTS opens a tender for software to track virtual asset transactions in tax evasion cases.
- The agency would examine hidden holdings, undeclared gifts, and offshore transfers.
- The system could trace mixers, wallets, and activity across 45 blockchain layers.
South Korea’s National Tax Service has opened a tender for software licenses to trace virtual asset transactions tied to tax evasion cases. The move signals a new enforcement step as the agency prepares to examine hidden crypto holdings and unreported transfers.
A government procurement notice said the contract covers “virtual asset tax evasion response transaction-tracking software licenses.” The budget is set at 146.5 million won, or about $99,500, including value-added tax.
The notice said delivery must be completed within 30 days of signing the contract. Bid submissions would run from April 28 to April 30, and proposal evaluations are scheduled for May 7.
National Tax Service Targets Hidden Crypto Assets
However, local outlet ZDNet Korea reported, citing an official from the agency’s scientific investigation unit, that the National Tax Service plans to conduct detailed reviews of transaction records linked to suspected tax evaders.
The report said the agency would use the findings to support legal action where unlawful activity is found. That may include undeclared gifts made through virtual assets.
According to the Public Procurement Service’s Nara Marketplace, the National Tax Service issued the tender notice on April 15. The agency is seeking a tool that could support deeper analysis of crypto activity in tax investigations.
The solution identified in local reporting is a virtual asset analysis platform developed by Chainalysis and TRM Labs. The system is described as one that could monitor transaction histories in real time and map transfers between wallet addresses and exchanges.
The National Tax Service plans to use the software to track hidden virtual assets held by tax evaders. It also aims to detect irregular inheritance transfers, undeclared gift transactions, and offshore tax evasion involving digital assets.
Investigators may begin a probe based on the analysis produced by the platform. The agency said enforcement measures may follow depending on what the review uncovers.
If hidden virtual assets are confirmed, authorities may freeze a taxpayer’s exchange account. That step could restrict deposits and withdrawals during the investigation process.
Unreported inheritance or gift transfers made through crypto may serve as grounds for punishment under relevant laws. The system is intended to provide data that tax officials could use in such cases
Crypto Tracking Scope Widens
The National Tax Service also plans to use the tool to identify mixer techniques linked to money laundering. Mixers are used to scramble transaction records and make it harder to identify the sender and recipient.
The agency said it would apply demixing technology to trace those transactions back. This would allow investigators to review movements that were meant to hide the path of funds.
The tracking scope is broad. Local reporting said the system could analyze about 70 million virtual assets, including Bitcoin, Ethereum, XRP, and stablecoins, across 45 blockchain layers.
The National Tax Service also said non-custodial wallets such as MetaMask and Fantom could be tracked. These wallets let users hold private keys directly, which often makes ownership harder to confirm.
The agency said that the limitation could be reduced in targeted cases. Because the system focuses on specific suspected tax evaders, officials believe they could identify wallet ownership and asset holdings to a certain extent.
The tender follows earlier local reporting that South Korea was preparing an AI-based crypto monitoring system ahead of its planned 2027 tax rollout. On March 12, The Korea Times reported that the National Tax Service had opened a bid for an AI-backed platform to analyze large volumes of crypto trading data.
Related: South Korea Pushes Blockchain Into Public Finance System
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