A mock-up of what a digital asset exchange application might look like under a one-exchange, multi-bank framework. The assets shown are unrelated to the article's content. [Created using ChatGPT]
A mock-up of what a digital asset exchange application might look like under a one-exchange, multi-bank framework. The assets shown are unrelated to the article's content. [Created using ChatGPT]

Amid a flurry of equity investment activity by financial firms targeting domestic digital asset exchanges, analysts say market competition could intensify sharply if the scope of corporate investment is broadened and a "one exchange, many banks" system is introduced. Exchange partnerships are expected to expand customer bases, but outcomes may vary significantly by bank depending on their digital banking capabilities.

Financial firms have been making a string of equity investments in domestic digital asset exchanges, including Dunamu, the operator of Upbit, and Coinone, according to industry sources Saturday. Even Bithumb — which has had relatively limited ties with the financial sector compared with other major exchanges — is reportedly reviewing various cooperation arrangements with multiple companies, including Kiwoom Securities.

Competition among banks over real-name verification account services is also resurfacing. Reports that Woori Bank recently held a series of meetings with representatives from Binance and Gopax to discuss potential real-name account partnerships have put the prospect of a "one exchange, many banks" arrangement — in which a single exchange partners with multiple banks — squarely on the industry's agenda.

Industry observers say banks had long taken a cautious approach to exchange real-name account partnerships, citing anti-money laundering burdens, but that sentiment is shifting as the digital asset market expands. "My understanding is that Woori Bank has shown interest for a long time in becoming an exchange account partner," one industry official said.

For banks, real-name verification account services represent more than a simple deposit and withdrawal channel — they function as an embedded finance channel that can secure new customer touchpoints. Exchange users who open bank accounts and move funds in and out are naturally drawn into the bank's app and services. K bank's significant expansion of its customer base through its real-name account partnership with Upbit is frequently cited as a key reason banks are paying close attention to exchange tie-ups.

"From the perspective of expanding the customer pool, a one-exchange, many-banks system could benefit banks," one financial industry official said. "But that assumes banks are very good at digital finance. If their non-face-to-face real-name account opening process is less competitive than that of internet banks, they could actually end up losing customers."

Market participants expect that if a multi-bank system is introduced, the competitive axis among banks will shift from simply providing accounts to encompassing the speed of non-face-to-face account opening, app usability, authentication convenience and anti-money laundering capabilities. Whereas which bank an exchange partnered with used to determine customer inflow, the dynamic could shift to one where customers choose which bank account to use — and banks compete for that choice.

Some observers also expect competition to eventually extend beyond account-opening convenience to the overall strength of financial apps. Global financial firms are moving toward integrating trading, payments and investment products into a single platform. Coinbase, the largest digital asset exchange in the United States, has laid out a strategy to consolidate shares, raw materials, prediction markets, digital assets and derivatives into one unified financial service platform. Robinhood is similarly broadening its range of financial products through its Robinhood Wallet.

Analysts suggest that if digital asset features are added to domestic financial apps, the user interface and user experience of existing mobile trading systems and banking applications could become decisive factors in attracting customers. Simply adding digital asset trading functions will not be enough — banks will need to raise financial convenience and accessibility at the same time to remain competitive.

The case for a multi-bank system is also gaining traction from a customer-choice standpoint. "From the customer's perspective, having a choice of deposit and withdrawal methods is a basic principle of banking," one digital asset industry official said. "In an open banking and MyData environment, users can access multiple accounts — yet exchange deposits and withdrawals have been restricted to a specific bank."

However, some argue that the relationship between banks and exchanges could shift again once won-denominated stablecoin legislation takes effect. While banks are currently exploring real-name account partnerships and equity investments to attract exchange business, if banks are eventually tasked with issuing won stablecoins and serving as trusted infrastructure, an overly close relationship with exchanges could invite conflict-of-interest concerns.

"If stablecoins are introduced, the deeper the relationship with exchanges becomes, the more banks may need to grapple with conflict-of-interest issues between issuance and distribution," one financial industry official said. "If banks take on the role of trusted infrastructure on the issuance side, there may come a point where they need to maintain a certain distance from exchanges over the long term."

Others counter that such concerns can be adequately addressed through stronger internal controls. "Banks already conduct basic screening when onboarding existing corporate clients," one digital asset industry official said. "They can respond by adding anti-money laundering procedures that reflect the characteristics of digital assets and reinforcing internal controls."


kyoung@heraldcorp.com