South Korean commercial banks are now in “fierce competition” with each other in the race to launch Bitcoin (BTC) and other cryptoassets custody products that they understand will prove a profitable market for the report.
As announced by media outlet Newsis, industry experts declare that the crypto-asset management market “is expected to grow even larger” when a landmark legal amendment claims all virtual asset service providers (VASPs) in the nation impose anti-money laundering protocols comes into the authority in March this year. The media outlet claimed that this would lead to “fierce competition” in the crypto market among banks.
The new legal measures will also hand banks considerable power when dealing with crypto exchanges, effectively granting them the authority to decide whether trading platforms are awarded real-name banking contracts.
Only platforms that abide by real-name, social security number-verified banking regulations will be allowed to continue trading.
It seems that banks now hold all the aces in the crypto sector and are looking to take precedence.
As earlier reported, NongHyup, Kookmin, and lately Shinhan, three of South Korea’s most notable commercial banks, have recently started their plan to begin offering crypto custody services and likely look to woo custom from domestic crypto exchanges. Rival Woori Bank is also reportedly interested in entering the sector.
The Newsis report’s author quotes In Ho, the head of Korea University’s Blockchain Research Institute, as stating,
“There have even been hacking accidents at Bithumb and Upbit, the largest cryptocurrency exchanges in Korea, so some people think that if banks take charge of [crypto custody], they will be compensated [in the event of further hacks]. Banks will be able to play to their strengths in this manner.”
And the professor added that banks are also keen to offer their services to an “increasing” number of professional investors with a penchant for crypto.
In the end,
“Things have changed. In recent times, not only individuals but also institutional financial companies and institutional investors are increasingly starting to invest in cryptoassets. This may be a contributing factor.”
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