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South Korea Sees its First Blockchain Consortium

Last Updated March 4, 2021 4:52 PM
Samburaj Das
Last Updated March 4, 2021 4:52 PM

A group of 21 financial investment companies and five blockchain technology firms have signed a memorandum-of-understanding (MoU) to develop distributed ledger solutions as a blockchain consortium.

Announced yesterday, the blockchain consortium is led by the Korea Financial Investment Association and sees a number of financial institutions and Fintech firms collaborate to form a blockchain think tank for the Korean capital market.

According to Business Korea, the IT Committee of the association will be sharing its blockchain case studies and results of its technical research with the members of the new consortium.

As reported by the publication, Park Sun-moo, managing director of NH Investment & Securities, one of the largest securities firms in Korea, stated:

This consortium is the first case in South Korea where multiple financial firms make use of blockchain. It will contribute to the realization of the essential value of blockchain and maximization of the convenience, security and efficiency of financial transactions.

The consortium’s roadmap includes will see research projects and endeavors ultimately lead to the establishment of blockchain solutions in personal authentication in 2017; clearing and settlement automation in 2018 and 2019 and; over-the-counter trading in 2020.

The blockchain consortium was initially hinted  by the South Korean Financial Services Commission (FSC) last month, a market effort to launch a government-civilian consortium for applications of bitcoin’s underlying innovation in Korean society and industry.

Ramping up on Bitcoin, Blockchain and Fintech Initiatives

Not to be left behind in the Asian Fintech race by China, Singapore and Japan, South Korea has notably turned up the dial on its efforts for a more embracing, technologically-forward market for bitcoin and blockchain technologies as well as wider Fintech initiatives.

Seoul is vying to become a Fintech hub in Asia.

A growing appetite for bitcoin among everyday South Koreans has resulted in financial regulators assembling a task force to introduce bitcoin regulations in 2017. In following Japan’s example, Korean FSC Chairman Yim Jong-yong recently said:

The government will push for the systemization of digital currency on a full scale in tandem with a global trend in the U.S., Japan and other countries.

The government also announced grants totaling three trillion won (approx. $2.65 billion) as financial support for the development of the Fintech sector in the country, over the next three years.

A notable private banking enterprise endeavor sees major Korean banking corp. Shinhan Bank to introduce a remittance service between Korea and China, backed by bitcoin.

South Korea’s securities exchange operator, Korea Exchange, recently launched a blockchain-pwered platform wherein startups are enabled to trade equity shares on the open market.

Meanwhile, the South Korean government has also collaborated with Singapore and Indonesia for Fintech research and development.

South Korea’s first blockchain consortium follows similar efforts by public-private collaborations in other countries over blockchain. Notable examples include Japan – for securities exchange, remittance and wider industry & Russia, with a private banking consortium.

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