Two highly popular crypto exchanges in South Korea, Korbit, and Bithumb have recently announced that the Kookmin Bank has disabled transactions with the two platforms beginning at the end of January.
Wave of Financial Uncertainty
For one of the largest financial institution in the country to outline its lack of support for crypto investors, comes as a sharp blow to the community. Specifically, this will fall in line with the country’s attempt to better verify users of exchanges, especially those using virtual bank accounts.
With trading platforms in South Korea, all investors are given a virtual bank account that can be used to either deposit or withdraw Korean won and there is no need to move funds directly through a traditional bank account.
Since the start of 2018, there has been a lot of troubling news coming out of the island country that has concerned many investors around the globe. While some were surprised at Kookmin’s decision, others worried that other institutions would soon follow suit.
However, the second largest bank in the country has also announced that they will not be conducting a similar ban. Shinhan Bank, in a similar, however inverse decision, explained that they would indeed by accepting withdrawals and deposits via Korbit. While the relief was palpable, the tension generated in the market from the uncertain maneuvers of the country was nonetheless real.
Moving further, there have even been talks that the government has a plan in the works to let certain financial institutions list bitcoin futures, similar to what authorities in the United States did in the tail end of 2017.
The government believes that this move would lead to more stability in the markets, allowing the exchange market for bitcoin to somewhat mature, lower excessive speculation, as well as helping to lower the premiums.
There is also set to be a number of wide-ranging regulations being released for investors by the South Korean government that will be practical for all parties involved in the world of crypto. They will be following the examples that have been laid out by the likes of Japan and the United States.
After the news broke that no ban was going to be implemented in the short-term at least, markets recovered somewhat, and the exchanges in South Korea have been optimistic regarding trading volumes and the modest rising of prices across the board.