South Korea builds AI tracker as crypto investor growth stalls

South Korea's tax agency is building a $2.2M AI system to track crypto transactions to enforce a newly announced 22% capital gains tax taking effect in 2027. The project signals stronger crypto taxation and compliance enforcement, increasing reporting pressure on CEXs and raising privacy and operational costs for DeFi users and firms. Market impact: heightened surveillance and a significant tax rate ahead of 2027 are likely to dampen trading activity and adoption, posing downside risk to crypto prices and sentiment.