A new report has linked a spike in the creation of new bank accounts in South Korea to a rise in crypto trading – an indication that a large influx of new traders in the East Asian nation has taken up crypto in 2021.
In 2018, Seoul created a set of guidelines that requires crypto exchanges to keep their own funds and those of their clients separate in banking procedures.
The guidelines also require all individual customers to create real-name and social security number-authenticated bank accounts. The nation’s “big four” exchanges – Upbit, Korbit, Bithumb and Coinone – have all opted into these guidelines, which necessitates exchanges to strike six-month contracts with domestic banks. Under a soon-to-be-implemented new law, these guidelines will become obligatory for all exchanges in the country.
And per Newspim, the three banks currently doing business with the “big four” exchanges have seen business boom in the past few months, coinciding with a huge rise in crypto prices. Bitcoin (BTC), for instance, has broken all sorts of records, reaching new heights of USD 52,000+ in recent weeks.
The media outlet points to data from the financial sector that shows the banks in question had a bumper January for new clients. The group of banks includes the traditional heavyweights NongHyup, which banks Bithumb and Coinone and Shinhan (currently banking Korbit), as well as the neobank K-Bank, which banks Upbit.
Collectively, the trio saw new account creation rise by 30% in the same month in 2020.
The media outlet’s calculations show that “at least 280,000 new accounts were opened in January” at K-Bank alone.
By contrast, Newspim added, traditional banking giants Kookmin and KEB Hana – which do not currently provide crypto exchange-linked accounts – saw their own rates of new accounts created decrease by a collective 23.4% from 1.15 million in January 2020 last year to 880,000 in January this year.
Both Kookmin and Hana have previously offered banking services to exchange customers, but chose to discontinue their collaborations.
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Originally Posted on: https://cryptonews.com/news/bank-account-data-may-indicate-a-rise-in-south-korean-crypto-9274.htm
By: Tim Alper