By Jhoo Dong-chan
Banks will not allow individual investors to open new virtual accounts for trading of cryptocurrencies as directed by the financial regulator, bank officials said Wednesday.
The regulator has directed them to accept newcomers if they install a system to ban anonymous virtual coin transactions, but major banks are reluctant to issue new bank accounts for cryptocurrency trading.
The nation’s “bitcoin craze” is expected to cool down without an inflow of cryptocurrency newcomers.
The nation’s six major banks _ the Industrial Bank of Korea (IBK), Shinhan, Kwangju, KB Kookmin, KEB Hana and Nonghyup Bank _ will establish a system that ensures only real-name bank accounts and matching accounts at cryptocurrency exchanges to be used for deposits and withdrawals by Jan. 30. The measure follows the government’s policy for a transparent virtual coin market.
The Financial Service Commission (FSC) said Tuesday it is “up to each bank whether to issue a new trading account for cryptocurrencies after they introduce a real-name service system.”
Last month, the government announced its plan to implement the real-name account policy while prohibiting banks from issuing a new virtual coin trading account for newcomers.
The three banks _ IBK, Shinhan and Nonghyup _ are currently under contract with local cryptocurrency exchanges such as Upbit and Bithumb, and will start issuing new cryptocurrency trading accounts for newcomers on Jan. 30.
However, they have decided to take a cautious approach.
“We were going to offer a new virtual coin-trading account for newcomers, but the final decision requires further discussion,” a Nonghyup official said. “It is a sensitive issue. Finance authorities have already imposed tightened regulations by banning the use of anonymous virtual coin transaction. The monitoring could develop further. We will see how things go.”
Virtual coin trader Sunwoo Hoon said if banks do not issue new accounts for newcomers, the nation’s cryptocurrency market will plunge a great degree. “I am very disappointed at the banks’ move,” he said. “Without newcomers’ investments, the market won’t be able to hit the bottom.”
FSC Vice Chairman Kim Yong-beom said Tuesday he expects banks to comply with the announced guidelines. “The FSC will punish banks if they fail to comply with the government's efforts to crack down on the growing speculative trading of crypto-assets by the public,” Kim said during a media briefing.