Bithumb Korea, the operator of Bithumb, South Korea's second-largest cryptocurrency exchange, is facing a setback after it failed to reach a real-name account issuance agreement with KB Kookmin Bank, a major local lender.。

Major banks not yet aligned with exchanges

Under the Specific Financial Transaction Information Reporting and Use Act, virtual asset exchanges in South Korea must use real-name accounts to conduct transactions involving the won through commercial banks.。Industry officials confirmed that the National Bank of Korea notified Bithumb last week of its decision not to work with the cryptocurrency exchange to offer real-name accounts.。

Bithumb Korea is aiming for a new partnership with National Bank of Korea to expand its user base as its existing contract with NH NongHyup Bank expires on March 24.。The talks failed, however, and the reasons for the collapse have not been disclosed.。

Currently, all of South Korea's top five cryptocurrency exchanges have partnerships with commercial banks, but none have ties to the four major commercial banks, including Kookmin Bank, Hana, Woori and Shinhan.。Upbit has a partnership with Internet lender K Bank, while Coinone and Gopax are affiliated with Kakao Bank and regional lender Jeonbuk Bank, respectively。

NH NongHyup renewal uncertain

Failure to reach agreement with National Bank of Korea will also affect Bithumb's prospects for renewing its contract with NH Agricultural Cooperative Bank.。NH NongHyup Bank has renewed its contract with Bithumb Korea every six months for the past five years and only signed a one-year contract in March last year.。

Although Bithumb announced in October that it would exempt cryptocurrency trading commissions to compete with Upbit, the market expects this policy to end due to sustainability concerns.。As a result, Bithumb ended its four-month commission-free campaign on February 5, charging 0 for all cryptocurrency transactions..04% fee, less than 0 for Upbit.05%。