South Korean lenders vie to partner with crypto exchanges

2023.01.25 10:01:01 | 2023.01.25 10:04:58

Bithumb is seeking to find a new lender that will provide real-name accounts for its operation. [Photo by Lee Chung-woo]이미지 확대

Bithumb is seeking to find a new lender that will provide real-name accounts for its operation. [Photo by Lee Chung-woo]



Cryptocurrency exchanges in South Korea are looking for new bank partners to issue them with real name accounts under tightened regulation.

According to multiple sources from the financial industry on Tuesday, Bithumb, the country’s second-largest crypto exchange, is seeking to find a new lender that will provide real-name accounts for its operation. The search comes as its contract with NH Nonghyup Bank is set to expire in March.

Among the candidates, Bithumb is hoping to join hands with app-based lender KakaoBank Corp. after seeing a boost in business at Coinone, which partnered with the internet-only bank in November last year.

Coinone saw a 177.48 percent growth in the average number of new subscribers in the first 7 days after it launched an account service with KakaoBank compared with the pre-registration period.

Korbit, another crypto exchange, is also hoping to shift its bank partnership to app-based lender Toss Bank, according to industry insiders.

Financial authorities, in the meantime, raise concerns about lack of anti-money laundering (AML) capacity at online-only lenders.

Kbank that partnered with crypto exchange Upbit in 2020 has expanded in size but the Financial Supervisory Service in 2021 deemed the online-only bank inadequate for the AML operation system.

“Questions are being raised whether small- and mid-size lenders that are trying to partner with cryptocurrency exchanges have sufficient AML capacity,” said an unnamed official from the financial authority.

By Choi Keun-do and Choi Jieun

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