Hope for South Korean Crypto Exchanges as Bank Keen on Contract Renewal
There may be a glimmer of hope at last for the South Korean crypto exchanges fearing for their future, with the neobank K-Bank reportedly set to renew its contract with the market-leading trading platform Upbit – just days after three major commercial banks ruled out the prospect of doing businesses with exchanges.
Trading platforms have been left to fear for their futures after landmark crypto regulation promulgated in March this year. The new law specifies that as of September 24 this year, all crypto exchanges in the country must abide by real name- and social security number-authenticated banking protocols on a six-month contractual basis.
The government has told banks that they are at liberty to conduct their own risk-assessment tests on exchanges – in effect giving the banking industry the power of life and death over the nation’s crypto sector. The heads of the major banks met this month to hammer out a circa-90-point list of criteria exchanges will have to meet in order to prove they are trustworthy.
However, it appears even that was not enough for many. Earlier this month, Woori, Kookmin, and KEB Hana all stated that dealing with crypto exchanges would be more trouble than it was worth.
But, tellingly perhaps, there was no word from Nonghyup, which currently provides real name services for two exchanges. Shinhan, traditionally the most crypto keen of the “big five” commercial banks, also refrained from commenting. And K-Bank, whose partnership with Upbit has proven almost too successful for its own good, also held back comment.
And in a new report from news agency YTN, K-Bank was quoted as saying that the prospects of renewing the existing contract between itself and Upbit, have “recently grown rapidly,” claiming that online account openings have helped spur on its business.
Mira Kim, a South Korean blockchain consultant, told Cryptonews.com:
“From what I hear, there’s now cautious positivity among some of the ‘big four’ exchanges (Upbit, as well as Bithumb, Coinone and Korbit). Nobody wants to say anything as they don’t want to jinx it, but I have a feeling that at least the ‘big four’ will either renew with their existing banking contracts or find alternatives partners before September.”
BNK Busan Bank has also previously expressed a desire to enter the arena.
And in a further development, reported EDaily, K-Bank’s recent success, largely due to Crypto Fever 2.0 and new account openings at Upbit, has spurred it to a level whereby it could become the largest neobank in the country, overtaking its biggest rival, the Kakao-operated Kakao Bank.
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