South Korean Banks Rush into Crypto Ahead of New Laws

The banks of South Korea are also moving faster to partake in the world of cryptocurrency and stablecoins

ContentsMajor Banks Form Crypto DivisionsKB Kookmin and Shinhan Expand PreparationsGovernment Reforms Drive Industry MomentumOther expected changes in the law are driving big financial players to plan to offer digital assets.

Major Banks Form Crypto Divisions

Top banks such as Shinhan, Woori, KEB Hana, and KB Kookmin are forming internal crypto task forces. Virtual wallets, blockchain alliances, stablecoins, and custodial services are some of the services these teams are developing. Woori Bank has formed a Digital Asset Team, which falls under the New Business Alliance Platform Department. It is a team that is dealing with research and the development of strategic crypto services.

Woori Bank is also reviving another initiative to provide custody services. It intends to enter into a business agreement with a company working on blockchain and create a consortium to facilitate its re-entry into the stablecoin business. This project was already underway in November of the previous year.

KB Kookmin and Shinhan Expand Preparations

KB Kookmin Bank has established a Digital Asset Response Council. The council also organizes a common digital asset management strategy among its affiliates, such as its arms in insurance, securities, and credit cards. It is also making efforts to forge relationships within the network and with outside companies.

Shinhan Bank has assembled a 20-man team to research and develop crypto services. Meanwhile, KB Kookmin is also filing trademark applications to reserve the names of stablecoins. It has registered 32 trademarks of stablecoins affiliated with the Korean won, plus 49 additional trademarks of coins of other currencies.

Government Reforms Drive Industry Momentum

The change in direction is a result of the country’s political change. President Lee Jae-Myung, the 11th elected president, will promote the growth of digital finance. During his reign, we began to see regulated crypto services emerge.

Some of the bills under consideration by the National Assembly include legalizing crypto-related services offered by banks. Such changes might legalize the issuance of stablecoins, custody platforms, and digital exchanges run by banks.

Industry leaders think it is the right time to act. An insider revealed to one of the top Korean outlets that the industry believes it will take time before a legal adjustment can occur. Companies are preparing early so that they will get a first-mover benefit once legislation is passed.

The regional banks are also involved. The Bank has introduced a team that works on digital assets. Busan Bank is investigating blockchain by having a special research team in place.