- Kookmin Bank of South Korea is working on becoming the first in South Korea to provide crypto investment services to the general public.
- The bank goal is to create a crypto index fund and an Outsourced Chief Investment Officer (OCIO) program.
The Kookmin Bank of South Korea has announced its intention to provide retail investors the opportunity to invest in a crypto index and ETFs, according to Business Insider. Today, the South Korean second-largest bank announced the formation of a Digital Asset Management Preparatory Committee to examine digital assets and all investment funds’ abilities.
The bank intends to create cryptocurrency ETFs and futures contracts. The committee will assess risk and compliance issues related to such offerings. Local media are reporting that the bank wants to allow its clients to trade cryptocurrencies by the end of this year.
An official at KB said the bank would introduce a standard index composed of multiple cryptocurrencies and establish various benchmark price indexes for tracking digital assets, with detailed information to be announced next month. This project is similar to Coinmarketcap, which tracks cryptocurrency prices. In addition, KB plans to start a service that will allow customers to securely capture cryptocurrencies within commercial bank accounts and make payments between accounts later this year.
In an interview, KB official Honggun Kimon revealed that they had created a “special blockchain department” to deal with digital currencies since early 2017. However, this department is focusing more on developing blockchain-based technologies rather than on cryptocurrencies.
MacroTrends reports that the Kookmin Bank, South Korea’s biggest by net earnings, has a total asset pool of $520 billion.
Kookmin Bank looks to solve existing problems associated with cryptocurrency markets, such as liquidity, price fluctuations, volatility, and security risks.
Kookmin Bank’s possible entry into the digital currency market can increase public trust in cryptocurrencies, MacroTrends stated. South Korea has been struggling to regulate its domestic cryptocurrency industry due to growing concerns over illicit activities such as money laundering and tax evasion.
The aim is to establish a crypto investment index fund and a fund that employs an Outsourced Chief Investment Officer (OCIO), also known as outsourced investment management, in order to provide assurances on principle investments. Retirement savings plans may also benefit from the OCIO concept.
In addition, Kookmin Bank will cooperate with South Korea’s blockchain consortium for processing and storage services. Also, the members of the Cryptocurrencies Management Committee include companies such as Accenture and IBM. The bank also announced it would invest in three other fintech companies specializing in blockchain technology.
KB interest in crypto investment
The Blockchain Capital is establishing a crypto investment fund for retail customers to take advantage of the growing popularity of cryptocurrency and nonfungible token (NFT) investments. The online presence of Shinhan Bank, for example, contains a separate section dedicated to assisting customers in managing their NFT collectibles on Klaytn, the country’s most popular blockchain.
Following the important move made by the Kookmin Bank, crypto investments have been criticized by certain authorities, such as the Russian government. On 28th December 2021, The Russian government issued an order to ban crypto investments. However, the Finance Ministry has now submitted a bill to regulate crypto as a crypto investment tool, not for payment.