Korean Banks Abandon Traditional Methods as Crypto Exchanges Take the Lead

South Korean banks are investing in crypto companies as traditional banking methods fall behind. South Korea's five largest won-denominated crypto exchanges recorded a 380% increase in cross-border transfers, processing 163.55 trillion won ($125.8 billion) last year. This surpasses the 20% growth of traditional banks' foreign-currency remittance volume from 2022 to 2025.

Professor Hwang Seok-jin from Dongguk University attributes this shift to lower crypto remittance fees, which are significantly cheaper than those charged by traditional banks. South Koreans living abroad and traders in Southeast Asia and the Middle East are increasingly choosing these faster and more affordable options.

Rather than competing with crypto, major South Korean banks have chosen to join forces by investing in crypto exchanges and developing their own blockchain systems. KBank has partnered with Ripple for a wallet-app-based remittance system, while Toss Bank is using Solana's technology for faster cross-border payments and settlements.