An up-and-coming South Korean bank seems to become struggling with the crypto market’s volatility – and might have to shelve its dpo (IPO) plans if crypto winter continues.
Per ENews Today, K-Bank, the banking partner from the market-leading crypto exchange Upbit, is “experiencing difficulties.”
The report described the bank – which in fact had wished to follow along with its greatest rival Kakao Bank onto the stock exchange – continues to be hit having a double whammy of not so good news.
The Upbit alliance introduced a large number of people to the financial institution, buoying its market price and leading K-Bank to formulate ambitious IPO plans. Under South Korean law, all crypto exchange customers must hold a genuine name-verified banking account using the exchange’s partner bank, and conduct all of their fiat-related transactions through this account.
With crypto investment skyrocketing across Columbia during the newest bull market, a large number of new clients found K-Bank – attracted mainly because K-Bank, like a neobank, permitted crypto investors to spread out their accounts online. These were also attracted that Upbit is just about the nation’s greatest and busiest crypto buying and selling platform.
But because the marketplace is constantly on the slump, buying and selling volumes have plummeted in Columbia. Late this past year, Upbit daily buying and selling volumes peaked in the USD 20.3bn level, per CoinGecko data. But during the time of writing, that figure has reduced to USD 3.3bn.
As recently March this season, nearly half of all of the money ever deposited on K-Bank’s platforms originated in Upbit customers.
Banking experts cautioned that the mass sell-from tokens could hit K-Bank’s liquidity. The financial institution has experienced difficulties because of its Upbit partnership. Even though K-Bank pocketed some USD 4.5m in charges from Upbit customers in Q1 of the year, sudden market swings have caused problems for example issues with K-Bank’s “loan-to-deposit ratio.”
An economic sector expert was quoted as opining:
“K-Bank must reduce its reliance on Upbit and carefully monitor market sentiment. It should take to regulate the timing of their IPO.”
The 2nd component that could pressure K-Bank to re-think (or delay) its IPO may be the current stock exchange slump, that has been sparked by “global economic tightening.”
K-Bank was likely to start formally speaking towards the south Korean stock market in regards to a listing prior to the finish from the month, but, the press outlet mentioned, “it has become known that [the financial institution] thinks about the problem twice” concerning the IPO.
K-Bank is keen to help keep pace with Kakao Bank, that has already made its stock exchange debut, but saw its share prices plummet soon after launching.
The report noted that other big-name firms, like the security provider SK Shieldus and also the One Store mobile application marketplace, had also tentatively withdrawn their very own IPO plans.
It added that another K-Bank rival, Toss Bank, seemed to be thinking about delaying its IPO plans for “two to 3 years” after initially proclaiming that it took it public the coming year.
Banks that work with crypto exchanges enjoyed a bumper year in 2021, when deposits around the four greatest South Korean buying and selling platforms increased by 1,368%.
The amount of real name-verified accounts at crypto exchange partner banks rocketed up by 777% year-on-year in 2021, with a minimum of 7.3m crypto wallet-linked accounts opened up.
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