The Korea Federation of Banks has raised alarm over the rise in altoine trading volume in crypto exchanges in the country.
According to a Monday report by The Korea Herald, the banking association has asked member banks to conduct an audit on the altcoins offered by their crypto exchange customers.
KFB is reportedly concerned about the potential risks of banks that provide account services to exchanges for altcoins.
A banking union official quoted by the Korea Herald explained:
“One of the criteria we suggest is the protection of digital assets and can be measured by the number of digital coins on an exchange. If an exchange deals with a lot of digital assets, it carries more risk. “
As previously reported by Cointegraph, altcoins have a noticeable axis by crypto traders in South Korea. The change coincided with a similar dip in bitcoin (BTC) trading activity, the first part of the year leading to the downfall of the Kimchi premium.
Three of South Korea’s “Big Four” crypto exchanges – Upbit, Cointone and Bithumb – each list over 150 altcoins on each platform. KFB’s recommendation comes in the form of BTC trading on these exchanges, accounting for less than 5%, much lower than the average on other major exchanges such as Coinbase and Binance.
Indeed, as of the time of writing, bitcoin trading activity occupying the top two positions in the last 24-hour period is just the coin. CoinMarketCap’s data shows BTC trading at 4.15% and 9.13% at Upbit and Bithumb, respectively.
Under South Korea’s real-name crypto trading paradigm, the bank is on the lookout for maintaining strict oversight over its cryptocurrency exchange customers, hence the reason for the KFB’s warning. The banking association also wants its members to be aware of the potential money laundering risks that may be associated with the current Alto currency trading explosion.
The increase in South Korea’s altcoin trade is still another piece of evidence in support of the weather cycle narrative of the season. Indeed, Bitcoin’s market capitalization dominance continues to decline and is now at its lowest level since July 2018.
Several major altcoins have set new all-time highs, with Aether (ETH) delivering over 450% in year-over-year gains, breaking the $ 4,000 milestone.