South Korea’s central bank has stated in a report today that local commercial banks had 2 trillion won (US$1.79 billion) as of December 2017 in digital assets and currencies.
“The amount of crypto-asset investment is not really big, compared with other equity markets, and local financial institutions’ exposure to possible risks of digital assets is insignificant,” the Central Bank said according to local media, before adding:
“Against this backdrop, we expect crypto-assets to have a limited impact on the South Korean financial market.”
The crypto holdings amount to 8% of all banks holdings, with the total, including equities, being $23 billion. Nonetheless the Central Bank considers their amount of crypto holdings to be insignificant.
It is the first time such figures are revealed from anywhere in the world, with South Korea rising as a hot spot especially after China banned crypto exchanges.
Billions in daily trading volumes came from there during the peak in December, with Upbit and Bithumb often handling $1 billion in trading volumes each.
That led to some government intervention, with initial suggestions of a complete ban overturned by popular online protests and complaints.
They instead opted for linking exchange accounts to bank accounts with in person identification, but Initial Coin Offerings (ICOs) remain banned.
Appetite for cryptos in the technologically advanced countries remain significant, with Samsung joining the Ethereum Enterprise Alliance, while an online shopping giant there announced plans to accept cryptos.
Upbit itself, of course, is operated by South Korea’s internet giant Kakaotalk, while a South Korean gaming company bought Korbit, another crypto exchange.
Estimates of just how many South Koreans hold crypto suggest they currently stand at 13%, rising to 20% for younger South Koreans.
But that in addition banks hold some $2 billion worth sounds somewhat surprising, although it does not appear rare as Germany’s regulator has stated six German banks are currently trading or have acquired cryptocurrency.