Shinhan Bank introduces crypto-key safeguarding services

Cryptocurrency, which was thought to replace the banking sector, is now being embraced by it. The biggest example of such an event is that of JP Morgan Chase. The CEO of the company, Jamie Dimon, initially called cryptocurrency a scam. Recently, word surfaced that the company is considering providing access to CME’s upcoming bitcoin futures via its own futures-brokerage division.

South Korea has been very open about virtual currency. One of the most influential banking services in South Korea, the Shinhan Bank, is now working on providing deposit services to its crypto-users, for currencies like bitcoin and ether. More specifically, the Shinhan Bank has been given a contract for the legal provision of custodial services for digital currency.

Usually, when virtual money is brought, the customer stores a key value as evidence. The key is vital for transferring assets, as well as keeping the transactions protected and confidential.  In June 2017, private data and information of almost 30,000 users was leaked. If the key is leaked, not only is your information and data is exposed, but the transfer of the assets cannot be verified. The crypto-key is stored on an online wallet app, but if a user’s phone is lost, or is hacked into, the particulars of the user become unprotected and can be leaked out.

The Shinhan Bank, Korea’s first bank to provide digital currency services, is in the middle of creating digital wallets to store the virtual assets securely. The bank aims to provide these services with the highest level of security, which will eventually have an incredible influence on the crypto market.

The bank stated that this service will keep the blockchain keys secure via digital safes, which will be provided by the bank. The bank also intends to initially provide a free depositing and storage service and will only be charged when the digital capital is withdrawn. It is an important element in the crypto-business for those users who do not want the responsibility of holding onto and keeping the keys safe as they fear that they might lose them.

Though, as a consequence of this service, the users will lose full control over their assets and will require bank’s authorization to move the assets around. This is not something an experienced crypto-dealer would look forward to, since ironically the only point of digital currency is to be able to have a complete financial control over one’s funds. Facilities like these erode this principle.

Nonetheless, there is no doubt that the virtual capital, which was initially thought to diminish the traditional banking, is now its huge promoter.