Bank of Korea probes financial firms’ exposure to crypto risks The central bank is surveying 31 financial institutions on how a major exchange shutdown, prolonged crypto downturn or losses at another firm could affect their operations.
The Bank of Korea has reportedly launched its first survey of banks and brokerages on cryptocurrency-related risks, asking how they would be affected by a major exchange hack, a market crash or heavy losses at another financial institution
The central bank began surveying 18 banks and 13 brokerages on Oct. 23 as part of its first reported review of financial institutions’ participation in the virtual asset market, according to The Herald Business and Yonhap, citing financial industry sources. The survey includes questions about each institution’s crypto-related staffing and budgets, business activities and reasons for entering the market, along with amounts invested in domestic and overseas crypto companies. One scenario asks how financial firms would be affected if South Korea’s largest crypto exchange by market share temporarily suspended operations following a major hack or similar incident.
Other questions address a steep fall in cryptocurrency prices followed by a sustained trading slump, and the potential fallout if another financial institution suffered heavy losses from a crypto-related incident. The survey began before last week’s $6.3 billion Binance hack, but the incident highlights the type of risk the central bank is examining. US authorities have attributed the attack to North Korean hackers.