In the first quarter of 2021, South Korean banks processed 64.2 trillion won (~$57.9 billion) in transactions on verified accounts linked to cryptocurrency exchanges, already exceeding the total for 2020. Maeil Business Newspaper reports, citing the country’s Financial Supervisory Service.
In 2020, the volume of such transactions reached 37 trillion won (~$33 billion). During the period, local credit institutions earned almost ten times more in commissions from crypto exchanges than in Q4 2020.
For instance, cooperation with Upbit yielded K-Bank $4.5 million. By comparison, over the entire previous year the banks’ commissions totaled $500,000.
Nonghyup Bank received more than $1.5 million from the Bithumb and Coinone platforms. Shinhan Bank, which in Q4 earned just $14,388 from a partnership with Korbit, collected $130,400 in commissions in the first three months.
For Nonghyup Bank and Shinhan Bank, these inflows do not exceed 1% of total quarterly revenues; however the neobank K-Bank, in addition to increasing profits, also recorded a substantial growth in new users.
According to Cryptonews, K-Bank plans to extend its contract with Upbit this summer. Sources familiar with the matter told the publication that other digital banks, such as Kakao Bank, are considering cooperation with players in the digital asset industry.
On 30 January 2018, South Korean authorities banned anonymous cryptocurrency trading within the country. Every trader must identify themselves via a bank account, and the name on the exchange account must match the account holder’s name.
In May 2021, Bank of Korea Governor Lee Ju-yeol warned that trading digital assets with leverage threatens the country’s financial system.
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