Will S Korea Turn to Blockchain to Solve Samsung Securities Crisis?
Leading figures in the world of South Korean IT have joined calls for securities firms in the country to start making use of blockchain technology solutions to avoid trading errors and irregularities.
Kim Hyung-ju, head of the Korea Blockchain Industry Promotion Association, said, “Blockchain technology can help promote transparency in the securities market. A modern market needs innovative technological solutions.”
Louis Jinhwa Kim, the director of the Korean Blockchain Association, took to Facebook to say, “One of the most fundamental solutions to the Samsung Securities crisis is blockchain application. Introducing blockchain technology could also prevent money laundering and increase transparency.”
Writing for the country’s top-selling newspaper, Chosun, IT columnist Kim Nam-gyu, however, said the answer may lie with third-generation cryptocurrencies. Kim wrote, “Blockchain technology cannot speed up securities’ trading systems. However, speed is at the core of blockchain evolution. Third-generation cryptocurrencies, such as EOS operate, on technology that moves faster than first-gen smart contract-based transactions.”
A national debate over the way traders operate – and the “outdated” technology they use – was sparked last Friday, when a so-called “fat finger” administrative error from a Samsung Securities employee saw the company accidentally dole out 2.8 billion shares in the company, each worth USD 37, to share-holding employees – instead of 2.8 billion Korean won (USD 2,625,000). A number of Samsung employees took advantage of the clerical error, selling around 5 million of the mistakenly issued shares.
Earlier this week, the head of the Korea Finance ICT Convergence Association said there was an “urgent” need for blockchain adaption in the securities sector – and has now been joined by a number of prominent blockchain and IT experts.