Bank of Korea Surveys 31 Banks and Brokerages on Crypto Risks

TLDR

• The Bank of Korea is running its first survey of how banks and brokerages take part in the crypto market.
• The survey covers 18 banks and 13 brokerages, including KB Kookmin, Shinhan, Hana, Woori and NH NongHyup Bank.
• Firms are asked how a hack at South Korea’s top crypto exchange or a long price slump would affect them.
• The survey began before last week’s $6.3 billion Binance hack, which US authorities blamed on North Korean hackers.
• Responses are reportedly due on Wednesday.

The Bank of Korea has started its first review of how banks and brokerages are involved in the crypto market. The central bank wants to know how these firms would handle major risks tied to digital assets.

The survey began on Oct. 23 and covers 31 financial institutions. That includes 18 banks and 13 brokerages, according to The Korea Herald and Yonhap, citing financial industry sources.

The banks include the country’s five major lenders. These are KB Kookmin, Shinhan, Hana, Woori and NH NongHyup Bank.

What the Survey Asks

The questionnaire asks about each firm’s crypto staffing, budgets and business plans. It also asks why each firm decided to enter the market.

Firms must report how much they have invested in domestic and overseas crypto companies. The survey also covers risk assessments and the risk controls each firm has in place.

One scenario asks how firms would be affected if South Korea’s largest crypto exchange by market share stopped operating for a time. The question points to a major hack or a similar event as the cause.

Other questions look at a steep drop in crypto prices, such as bitcoin, followed by a long trading slump. The survey also asks about the fallout if another financial firm suffered heavy losses from a crypto incident.

The survey started before last week’s $6.3 billion hack at Binance, the world’s largest crypto exchange. US authorities have blamed North Korean hackers for the attack.

Banks Prepare as Laws Move Slowly

“Financial institutions are making their own preparations even as virtual asset legislation is moving more slowly than the market expected,” a Bank of Korea official told The Korea Herald.

Another official said firms already report to the Financial Supervisory Service, but coverage of crypto activities is still lacking. The central bank is gathering basic data from individual banks and brokerages.

South Korean firms have kept testing stablecoin services. KB Financial Group completed a won-based stablecoin pilot in May, while Kakao Pay and KakaoBank partnered with Fireblocks in September.

The Bank of Korea has pushed for bank-led stablecoin issuance. Disputes over which firms should be allowed to issue stablecoins have slowed progress on the proposed Digital Asset Basic Act.

In its June Financial Stability Report, the central bank said links between crypto and traditional markets have grown stronger. It found the link with the stock market has stayed above past levels since the US introduced spot ETFs in 2024.

Last November, the bank also warned that won-based stablecoins could bring risks. These included short-term interest rate swings and coin runs that could spread risk into traditional markets.

Regulators have also stepped up cybersecurity checks. In October, the Financial Services Commission found security problems at 130 of 555 financial companies.

The commission proposed tougher rules, including more frequent vulnerability checks and greater executive accountability. The plan followed security incidents at 16 companies, including crypto exchanges.

Financial firms are reportedly due to submit their survey responses to the Bank of Korea on Wednesday.

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