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South Korean Investors Snubbing Real-name Crypto Banking

Tim Alper
Last updated: | 1 min read

Media outlet Money Today claims that South Korean customers appear loath to open real-name cryptocurrency bank accounts. In January this year, the government unveiled guidelines that required cryptocurrency to Korean won transfers through banks to be made via special real-name, social security number-verified accounts that could be monitored in an effort to contain money laundering.

Source: iStock/FangXiaNuo

Six banks chose to adhere to the guidelines, including Kookmin Bank, KEB Hana Bank and NH (NongHyup) Bank. Cryptocurrency exchange-linked accounts at these three banks are currently hosting on-site investigations by the regulatory Financial Supervisory Commission and the Financial Supervisory Service.

However, only 440,000 customers have so far opened real-name bank accounts at the six banks – despite concerns that the guidelines may soon become legally binding. Experts claim that falling investor confidence and banks’ suspicion of smaller exchange platforms could be the reasons behind the program’s sluggish start.

Money Today quotes a financial expert as saying, “The Korean cryptocurrency market has shrunk so much that it seems that there are not many investors willing to withdraw their crypto into Korean won.”

Experts also said that following the recent arrest of two small- and medium-sized cryptocurrency exchange CEOs, and an ongoing police investigation into smaller, Seoul-based exchanges, banks are reluctant to do business with exchange platforms other than market leaders Bithumb, Upbit, Korbit and Coinone.