Woori Financial Group, one of South Korea's largest financial conglomerates, will offer cryptocurrency custody services. The bank will develop a joint venture with Coinplug, a blockchain-based development company. This conglomerate marks the third largest bank in the country to enter this market, after KB Kookmin Bank and Shinhan Bank.
Woori Financial will develop a joint venture to offer custodial services
Woori Financial Group, one of South Korea's largest banks, will soon offer cryptocurrency custody services. According to the Korea Economic Daily, Woori will establish a joint venture with Coinplug, a blockchain solutions development company with over 300 blockchain patents.
While South Koreans have traditionally been drawn to cryptocurrency, their regulatory framework prohibits them from relying on exchanges for safekeeping. This has spurred banks' interest in stepping up and including cryptocurrency custody in their services. However, from a legal point of view, banks cannot offer these services independently and must enter the market through a joint venture.
However, banks are well positioned to be the leading cryptocurrency custody providers in the country. Banking institutions are generally well regarded in the country, and cryptocurrencies are a historic industry. A Woori official said: "In overseas markets, custody of digital assets has become an established and successful practice among the new services offered by banks."
Banks offer custody of cryptocurrencies as a new source of revenue
With Woori's move, all three of the country's major banks now offer cryptocurrency custody services. The largest banking conglomerate in the country, KB Kookmin Bank, was the first to enter the crypto space. It established a joint venture in November 2020, Korea Digital Asset Co. (KODA), with other blockchain-related companies.
The second Korean bank to dive into the new field was Shinhan Bank. Shinhan Bank entered into a joint venture with Korbit this year to establish its own custody service, called Korea Digital Asset Custody Co. Custody is more like traditional services offered by banks for fiat currencies, and some think this is the which is why banks are incorporating this business as another relatively stable source of income.
Furthermore, those who want to create a secure source of income can start trading cryptocurrencies, even automatically, with reliable and secure platforms such as Bitcoin Pro.
South Korean regulators have taken a tough stance on cryptocurrencies, proposing new regulations that could severely affect cryptocurrency exchanges in the country. They also banned police officers from buying cryptocurrencies in May. What do you think of the Woori bank entering the cryptocurrency custody business? Tell us in the comments section below.
