At the first official meeting between five of the biggest crypto exchanges and the government of South Korea, Cumberland Korea CEO Hong Joon-ki said that both the government and local financial institutions have to acknowledge the efforts of Nasdaq, Fidelity, and some of the largest conglomerates in the global market working to strengthen the infrastructure around cryptocurrencies.
Hong, who has been leading the operations of Cumberland, a major over-the-counter (OTC) exchange in South Korea, told government officials including several congressmen, members of the National Assembly, and Financial Services Commission (FSC) authorities that the government has to be aware of the rate at which the cryptocurrency sector is growing with the involvement of major financial firms.
In the third quarter of 2018 alone, the world’s two largest stock exchanges NYSE and Nasdaq along with the global market’s fourth biggest asset manager Fidelity established Bitcoin ventures such as futures markets and custodial solutions to drive cryptocurrency adoption and provide an easy way for institutional investors to invest in the market.
Throughout the past two years, only two major banks Shinhan and Nonghyup have focused on improving the infrastructure of the local cryptocurrency exchange market.
Shinhan Bank, the country’s second most valuable commercial bank, created a crypto exchange called Gopax equipped with the same trading engine used by Nasdaq with withdrawals and deposit support to and from all of the banks in South Korea.
With foreign financial institutions in the likes of Fidelity, Goldman Sachs, Morgan Stanley, Nasdaq, and NYSE aggressively expanding into the cryptocurrency sector, Cumberland Korea CEO Hong Joon-ki said that the government and the local financial sector have to begin leading initiatives to follow the global trend.
“In 1993, when I came to South Korea as a derivatives expert, the local market and the government considered derivatives to be dangerous and risky speculative vehicles. Fast forward nearly two decades, South Korea is issuing bonds and derivatives to enter overseas markets. Financial institutions in South Korea must seriously consider the cryptocurrency market and the government has to encourage financial institutions to serve cryptocurrency investors.”
The Cumberland CEO added that security tokens will drastically change the future of crypto and finance, and major hedge funds and venture capital firms have already started to initiate big bets on the security token market, as seen in the $28 million investment of Andreessen Horowitz in Harbor.
“The global cryptocurrency market will shift to security tokens quickly. Venture capital, hedge funds, sports teams, real estate, artworks, and various types of assets will become tokenized on the blockchain. Global financial institutions are entering the crypto market with the vision of tokenizing and digitalizing existing assets and they are expanding their initiatives.”
The involvement of Nasdaq, Goldman Sachs, FIdelity, and other institutions in the cryptocurrency market may not have had any impact on the short-term price trend of cryptocurrencies.
But, the initiatives of the abovementioned conglomerates are leading government officials to perceive the cryptocurrency sector from a different stance and consider cryptocurrencies as an emerging asset class.
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Last modified: May 20, 2020 2:09 PM UTC