Bank of Korea Surveys 31 Financial Firms on Crypto Risks

The Bank of Korea is surveying 18 banks and 13 brokerages to assess their exposure to cryptocurrency-related risks, according to The Korea Herald and Yonhap. Launched on Oct. 23, the review is the central bank’s first reported examination of South Korean financial institutions’ involvement in the virtual asset market. It asks about crypto staffing, budgets, business activities, market-entry strategies and investments in domestic and overseas crypto companies.

The questionnaire examines several stress scenarios, including a temporary suspension by South Korea’s largest crypto exchange following a major hack, a sharp price decline followed by a prolonged trading slump, and potential losses if another financial institution suffered a significant crypto-related failure. Responses are reportedly due Wednesday. The survey began before last week’s reported $6.3 billion Binance hack, which US authorities attributed to North Korean hackers.

The review comes as South Korean banks expand stablecoin initiatives amid regulatory delays. KB Financial Group completed a won-denominated stablecoin pilot in May, while Kakao Pay and KakaoBank partnered with Fireblocks in September to develop digital asset infrastructure. The Bank of Korea favors bank-led stablecoin issuance, but disputes over which institutions should be allowed to issue stablecoins have slowed progress on the proposed Digital Asset Basic Act.

Regulators are also tightening cybersecurity rules for the sector. In October, the Financial Services Commission proposed more frequent vulnerability assessments and greater executive accountability after identifying security deficiencies at 130 of 555 financial companies. The changes follow incidents involving 16 firms, including crypto exchanges, as regulators seek to strengthen the industry’s preparedness for hacks, outages and market disruptions.