South Korean banks demand a level playing field in the digital asset market
Date: 2025-04-11 Author: Gabriel Deangelo Categories: BUSINESS
South Korean banks have called on the government to review the current rules for interaction with cryptocurrency exchanges, which, according to them, hinder fair competition and slow down the development of financial technologies.
During a meeting with legislators, representatives of the banking sector expressed dissatisfaction with the model according to which each crypto exchange is allowed to cooperate with only one bank. This rule was introduced at an early stage of the development of the crypto industry in the country, when the priority was to ensure transparency of operations and minimize the risks of financial violations.
However, as bankers emphasized, the current regulation has lost its relevance. It gives an advantage to those financial institutions that were the first to take positions in the crypto sector and excludes other players from participating in this fast-growing segment.
Woori Bank President Jeong Jin-wan noted that the current exclusivity system does not reflect modern market realities and puts those banks that joined the digital space later at a disadvantage. He proposed allowing exchanges to cooperate with several banks at once, which, in his opinion, will expand the choice for customers and improve the overall quality of financial services.
In addition, bank representatives indicated that lifting restrictions will contribute to increased competition, the development of innovation and better satisfaction of the growing interest of users in digital assets.
Meanwhile, the Financial Services Commission of South Korea (FSC) is still maintaining a cautious position. Kim Sung-jin, head of the FSC's virtual assets department, previously stated that local crypto platforms are not yet ready to fully comply with international anti-money laundering standards. This, according to him, is the main obstacle to allowing foreign investors to enter the South Korean market.
Thus, the question of reforming the current model of interaction between banks and crypto exchanges remains open. The banking community is pushing for changes that they say will allow South Korea to strengthen its position in digital finance, but regulators have been slow to loosen their grip.
