| An electronic board shows price movements of virtual assets at a customer center of Bithumb in southern Seoul, April 11. Yonhap |
By Lee Yeon-woo
As the virtual assets market entered a crypto winter last year, the profits of banks that offer real-name bank accounts for virtual asset transactions in Korea were also halved.
The amount of the banks' commission showed a downtrend last year, which was in contrast to the continuous surge observed from 2019 to 2021, according to the Financial Supervisory Service's (FSS) data, submitted to Rep. Yun Chang-hyun from the People Power Party (PPP).
The data indicates that five cryptocurrency exchanges ― Bithumb, Coinone, Gopax, Korbit and Upbit ― paid a total of 20.4 billion won ($ 15.6 million) in commission fees to banks with whom they were contracted to issue real-name accounts. This represents a significant decline of 49.4 percent compared to 2021 when commission fees reached 40.3 billion won.
Since an amendment aimed at preventing money laundering took effect in 2018, cryptocurrency exchanges are required to conduct transactions using bank accounts in the names of actual traders.
Specifically, Upbit, the nation's dominant cryptocurrency exchange, paid 13.9 billion won to K-Bank in 2022, which was a decrease of 52.4 percent compared to 2021. Bithumb paid 4.9 billion won to NH Nonghyup Bank, down by 35 percent.
CoinOne paid 9.8 billion won and 72 million won to NH Nonghyup Bank and KakaoBank, respectively, after building a new partnership with the internet-only bank last November. Corbit and Gopax paid 4.8 billion won and 19 million won, respectively, to Shinhan Bank and Jeonbuk Bank.
The significant drop in the banks' commissions can be attributed to the market recession, which has affected the sales and operating profits of major cryptocurrency exchanges. For instance, the price of Bitcoin, which surged to over 80 million won in Nov. 2021, plunged to 21 million in Dec. 2022.
Dunamu, the operator of Upbit exchange, reported a net profit of 130.8 billion won last year, which was a decrease of 94.1 percent compared to the previous year. Bithumb Korea, the operator of Bithumb, saw an 85.3 percent decrease to 95.3 billion won in its net profit last year.
"There was an imbalance in the partnership between banks and virtual asset exchanges," Rep. Yun said. "It may be time to reconsider the forced regulation of limiting one exchange to one bank in order to encourage more banks to enter various blockchain businesses."