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Bill to End Korea’s ‘One Exchange, One Bank’ Rule Heads to National Assembly Review
Forecast Trend Report by Period
A bill that would allow cryptocurrency exchanges to secure real-name accounts from multiple banks is set to be taken up in South Korea’s National Assembly.
Edaily reported on Aug. 26 that the National Assembly’s Political Affairs Committee will hold a plenary session later that morning to introduce 136 bills, including an amendment to the Act on Reporting and Use of Certain Financial Transaction Information proposed by People Power Party lawmaker Kim Sung-won.
The amendment would establish a legal basis for virtual asset service providers to receive real-name verified deposit and withdrawal accounts from more than one financial institution. The standards, conditions and procedures for opening those accounts would be set by presidential decree. If the bill passes, the current de facto “one exchange, one bank” system could shift to a structure that allows exchanges to partner with multiple banks.
Upbit currently partners with K Bank, Bithumb with KB Kookmin Bank, Coinone with KakaoBank, Korbit with Shinhan Bank and Gopax with Jeonbuk Bank for real-name accounts. The one-exchange, one-bank framework is not codified in law. It became established after the government introduced a real-name system for virtual-asset trading in 2017 and the Financial Services Commission issued anti-money laundering guidelines in 2018.
Financial authorities, however, appear cautious about changing the system immediately. The Financial Services Commission told the committee that the effects of the current framework on anti-money laundering and the exchange market have not been sufficiently confirmed. It said any changes should be reviewed after the second phase of digital-asset legislation takes effect, taking into account exchanges’ anti-money laundering capabilities and the market’s competitive landscape.
The amendment will next be referred to the committee’s bill review subcommittee for more detailed discussion. The committee’s chief specialist also said allowing ties with multiple banks could lead bank demand to concentrate on larger exchanges, and that the issue should be considered alongside broader talks on the second phase of digital-asset legislation.
