South Korean banks are rushing to prepare crypto and stablecoin-related business plans, with some of the country’s biggest lenders finally set to enter the crypto fray.
The South Korean newspaper Maeil Kyungjae reported that banks are creating dedicated organizations and preparing for the rollout of legislation that will let them issue and operate stablecoins. The media outlet, the nation’s top business newspaper, wrote:
“As discussions on legalizing stablecoins heat up rapidly, the banking sector is now taking proactive measures.”
It explained that lenders have established dedicated internal organizations and are forming consortia as they look to move quickly into the sector.
South Korean Banks: Poised to Act Fast
Banks such as Shinhan and Woori formed initial plans to launch crypto-related business operations as far back as 2018-2019.
A branch of Woori Bank in central Seoul, South Korea. (Source: Choi Kwang-mo)However, they were ultimately forced to shelve these when the government of former president Moon Jae-in decided to ban initial coin offerings and effectively sideline the crypto industry.
President Lee Jae-myung, however, has talked enthusiastically about crypto since his election in June this year.
Lawmakers are poised to respond by legislating. A raft of pro-industry reforms is now on the desks of various National Assembly committees.
Banks, sensing a change in political winds, are responding fast.
Woori has launched a specialized Digital Asset Team responsible for “various digital asset-related businesses, including stablecoins” and digital wallets.
This nine-member team is part of Woori’s New Business Alliance Platform Department.
Woori Bank has also signed a business agreement with a blockchain startup as it looks to resurrect its crypto custody plans.
It is also working on a stablecoin consortium with various unnamed companies, Maeil Kyungjae wrote.
KB’s Plans
Rival bank Kookmin Bank (KB), meanwhile, launched a Digital Asset Response Council in June.
It wants to create a systematic, group-wide response that covers its wide range of KB Financial Group affiliates.
This council has developed a range of rapid response scenarios for possible future policy changes.
It is also reviewing collaboration possibilities with “external partners,” including insurance firms, credit card issuers, securities firms, and asset management companies.
The council’s stated aims involve fostering strategic coordination in the crypto sector among its many affiliates.
A branch of KEB Hana Bank. (Source: Nesnad [CC BY 2.0])Crypto Plans in Motion
KEB Hana Bank has created a crypto working group comprising relevant department members from each of its affiliates.
The group is believed to be working on matters related to won stablecoins. It is also looking at infrastructure requirements for future projects.
Like Woori, KEB Hana is also working on a joint venture crypto custody project and is eyeing the global market.
And Shinhan Bank has created a crypto task force that comprises “approximately 20 employees.”
Banks have also applied for a whole host of crypto and stablecoin-related trademarks. KB, for instance, has applied for a total of 32 trademarks related to won-pegged stablecoins and 49 trademarks related to foreign currency stablecoins.
Other banks are also rushing to prepare for reforms. These include the Upbit partner K Bank, which recently established a digital asset task force.
Regional banks are also active, with Busan Bank operating a blockchain team that looks at all “aspects of blockchain technology.”
South Korean banks believe, the newspaper added that “if stablecoins are legalized, financial firms need to quickly launch related services to secure a lead in the market.” An unnamed South Korean banking industry official told the news outlet:
“Although the reforms are yet to be implemented, they will take time to put into action. That is why we believe that, by preparing in advance, we can enter the market quickly after lawmakers introduce new legislation.”
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