South Korean Banks Embrace Crypto: New Pilot Program Drives Exchange Partnerships
1min read South Korean banks are swiftly moving to form partnerships with cryptocurrency exchanges, capitalizing on the country's evolving regulatory landscape. The Financial Services Commission (FSC) recently announced a pilot program set to launch in the second half of 2025, allowing 3,500 corporate entities to invest in and use cryptocurrencies for financial purposes. This marks a significant shift from the 2017 ban on corporate crypto transactions.
In response to this new regulatory clarity, major exchanges in South Korea are forging strategic alliances with banks. Upbit, the country's largest exchange, has partnered with K Bank, while Bithumb, the second-largest exchange, has shifted its partnership from Nonghyup Bank to KB Kookmin Bank, the largest bank in South Korea.
The FSC expects the pilot program to boost corporate participation in the crypto sector. To ensure a robust and secure environment, the regulator plans to implement a set of transaction guidelines. These guidelines will help banks verify the purpose of transactions and the origin of funds, encourage the use of third-party custody and management services, and enhance information disclosure to investors. The decision to issue real-name verified accounts will be left to the discretion of banks and exchanges, following a thorough screening process.
The South Korean government's approach to cryptocurrency regulation has been evolving, with a focus on balancing innovation and investor protection. As the country's financial institutions and crypto exchanges continue to collaborate, the crypto sector in South Korea is poised for growth and increased adoption.
