South Korea's Shinhan Bank Is Cracking Down Harder on Anonymous Crypto Users

Shinhan Bank, the second largest financial group in South Korea by assets, is redoubling its efforts to police accounts related to cryptocurrency exchanges, according to local press reports.

The bank is reportedly planning to increase the number of staff scrutinizing such accounts, as well as continuing to develop systems dealing with potential fraud and monitoring transactions.

Crypto is not being locked out from the Korean banking system.

The cryptocurrency-related AML guideline requires traders of crypto on the exchanges to open real-name bank accounts at the same bank servicing the exchange itself.

Foreigners are prohibited from opening bank accounts for cryptocurrency trading.

Around the same time, Kookmin Bank and Nonghyup Bank came under the scrutiny of the FSC for failures in terms of implementing the anti-money laundering guidelines.

The two banks plus Hana Bank were later inspected by the Financial Supervisory Service, another domestic regulator, for similar reasons.

Kookmin Bank, the country's largest bank by assets, reportedly withdrew from offering cryptocurrency accounts for a time, but then in 2019 signed deals to enhance its capabilities in digital currency asset management.

Due to the sudden closure of accounts by Kookmin, business gravitated toward Shinhan Bank in early 2018.

"The Korean government allowed Bithumb to use NH Bank only. Therefore, we have nothing to do with Shinhan Bank, and it is not relevant to our operations," according to a source at Bithumb, which is controlled by Singapore's Blockchain Exchange Alliance and is by some measures the largest exchange in Korea.