South Korea’s Woori and Shinhan banks have just announced their intention to introduce “crypto-asset services”. That means that four of the country’s top five banks, holding a combined value of more than $1.2 trillion in assets, are now poised to introduce crypto services.
Each of the banks aims to hold and manage cryptocurrencies for clients. Both Shinhan and Woori announced their plans in direct response to the amended Special Financial Transactions Information Act which will change legislation around crypto assets, coming into force next year.
Shinhan bank previously announced plans for crypto storage in 2017, but these plans were thwarted by the government in January 2018.
The NH Nonghyup Bank and Kookmin Bank have already coordinated blockchain teams to implement crypto custodial features, with Nonghyup the most advanced and hoping to launch services for “institutional investors” in the coming months.
Too little, too late?
Blockchain experts in the country have voiced concerns that these steps are “too little, too late” citing American institutions that are well ahead of South Korea’s banking sector. The head of the Blockchain Research Center at Dongguk University Park Sung-joon said he was “worried” that the nation’s financial “competitiveness” could be in jeopardy as a result:
“Other countries are moving very quickly in this regard. But there is still no legal system in place in South Korea, so progress is slower than expected.”
Without “institutional support”, he suggested that this push for crypto custody might not eventuate into widespread integration.
Korea loves crypto
Although the finance sector has been criticized for its slow uptake on blockchain technology, other industries have been faster to integrate it into their solutions. More than 1 million people have adopted a new blockchain-based digital driver’s license app after only 3 months. One of South Korea’s biggest banks KEB Hana Bank has partnered with the Korea Expressway Corporation to implement a blockchain-based toll system for the country’s highways.
And this week news emerged Seongnam’s payment program will be expanded by issuing new digital gift certificates while beachgoers in Busan will be able to pay for services with Bitcoin (BTC) and Ethereum (ETH).