Bank of Korea surveys banks and brokerages on crypto-related risks

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The Bank of Korea has asked 18 banks and 13 brokerages to assess their exposure to cryptocurrency-related risks, including the potential impact of a major exchange hack, a market crash or losses at another financial institution.

The survey began on 23 October and covers firms’ crypto-related staffing, budgets, business activities and investments in domestic and overseas digital asset companies. One scenario examines the consequences of South Korea’s largest crypto exchange suspending operations after a major security breach.

Other questions address a sharp fall in cryptocurrency prices followed by a prolonged decline in trading activity, as well as the possible impact on financial firms if another institution suffers heavy losses linked to crypto assets.

The review began before last week’s $6.3 billion Binance hack, which US authorities have attributed to North Korean hackers. Financial institutions are reportedly expected to submit their responses by Wednesday.