Choi Heung-shik, head of the Financial Supervisory Service (FSS), said on February 20 that local banks do not have to hesitate to open cryptocurrency accounts.
According to some experts, his remark is just another reiteration of the South Korean government’s basic stance on cryptocurrencies. According to some others, however, his remark implies that the South Korean government is planning to allow to some extent normal cryptocurrency trading that is based on trader identification and free from concerns over money laundering with its regulations remaining effective as evidenced by the recent sharp decline in cryptocurrency trading volume.
Before the remark, the head of the FSS was rather negative about cryptocurrencies. “The cryptocurrency bubble will burst soon and I bet on it,” he said late last year. The National Assembly of South Korea criticized him for this remark and he had to apologize.
Still, the local financial authorities have been tacitly opposed to an increase in cryptocurrency trading volume led by local banks. Under the circumstances, the banks including KB Kookmin, Shinhan and Hana have been hesitating to open cryptocurrency accounts. These banks already have their own systems for trader identification, money laundering prevention, etc.