- Leading banks are urging lawmakers to loosen the one-bank-per-exchange rule.
- Over 30% of South Korea’s population (16 million people) now holds crypto.
- More than 20% of high-ranking public officials in South Korea own crypto.
South Korea’s cryptocurrency market is booming, with more than 16 million citizens—over 30% of the population—now holding crypto exchange accounts.
This huge user base has led the country’s top traditional banks to push lawmakers for regulatory changes that they say currently block fair competition and limit innovation in the digital asset space, as per a report from local news outlet Money Today.
Why Are Korea’s Big Banks Pushing for Rule Changes?
At a high-level meeting held this week, executives from the nation’s largest financial institutions—KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup, Jeonbuk Bank, and internet-only Toss Bank—urged lawmakers from the ruling People Power Party to revisit the one-to-one partnership rule between banks and crypto exchanges.
Woori Bank’s President Jung Jin-wan argued that local exchanges should be allowed to partner with multiple banks, citing consumer limitations and institutional demand.
How Does the Current Law Create an ‘Uneven Playing Field’?
Under current law, each crypto exchange in South Korea must partner exclusively with one bank to offer fiat-to-crypto services, a regulation aimed at preventing money laundering and ensuring real-name verification.
While effective in enforcing accountability, critics argue that it has created an uneven playing field, allowing some banks to reap massive user growth while others are left out.
Related: Survey: Nearly 50% of Korean Investors Expect US Tariffs to Harm Crypto Market and Drive Price Drops
The prime example cited is K-Bank. The neobank that partnered with top exchange Upbit in 2020, saw its user base skyrocket from 2.19 million to 6.6 million in a single year. As of late 2024, that figure had nearly doubled to 12.7 million.
This outsized growth, enabled by regulatory exclusivity, has made the current framework a contentious issue among South Korea’s major banking players.
How Big is South Korea’s Crypto User Base?
Data obtained by opposition lawmaker Cha Gyu-geun and reported by Yonhap reveals that South Korea’s crypto user base surpassed 16 million following US President Donald Trump’s election win last November.
That number represents nearly one-third of the country’s population, with holdings totaling more than 102.6 trillion won ($70.3 billion). Analysts are predicting the figure could hit 20 million by year-end, despite concerns of market saturation.
Related: Google Play Store Boots Unregistered Exchanges in South Korea
On the other hand, a recent report from the country’s Ethics Commission for Government Officials revealed that more than 20% of high-ranking public servants hold crypto assets, averaging 35.1 million won ($24,000) each.
The disclosures—totaling 14.4 billion won ($9.8 million) across 411 individuals—include holdings in mainstream tokens such as Bitcoin, Ethereum, XRP, Dogecoin, and LUNC.
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