Hana Bank to Establish Joint Digital Asset Custody Venture with BitGo

JPMorgan Adopts Blockchain for 24/7 Interbank Transactions in IndiaAmerican multinational financial services company JPMorgan Chase has partnered with six major Indian banks to introduce a blockchain-based platform that leverages the technology’s benefits to address the restraints of traditional finance.Photo by Naveed Ahmed on UnsplashInterbank settlementThe collaboration aims to enable interbank settlement of US dollar transactions in India’s Gujarat International Finance Tec-City (GIFT City), positioning it as an alternative trading center to Singapore and Dubai. That’s according to a report from Bloomberg, published on Monday. The participating banks in this pioneering initiative include HDFC Bank, ICICI Bank, Axis Bank, Yes Bank, IndusInd Bank, and JPMorgan’s own banking unit at GIFT City.Onyx blockchainThe blockchain project, utilizing JPMorgan’s Onyx platform, aims to expand the capacity of the existing settlement system. Kaustubh Kulkarni, JPMorgan’s senior country officer, stated that the platform will enable the participating banks to process instant transactions 24 hours a day, seven days a week. By leveraging blockchain technology, the interbank settlement process will become faster and more efficient, overcoming the current limitations of time and availability.Onyx blockchain was established in 2020 and serves as JPMorgan’s digital assets network. It was specifically designed with interbank settlement and wholesale payment transactions in mind.Reduced settlement timeUnder the prevailing interbank settlement system, transactions could take several hours to complete, and settlement is not available on weekends or public holidays. JPMorgan’s blockchain pilot, however, will remove these barriers, as Kulkarni explained: “By leveraging blockchain technology to facilitate transactions on a 24x7 basis, processing is instantaneous and enables GIFT City banks to support their own time-zone and operating hours.”This initiative not only addresses the operational challenges of interbank settlement but also serves New Delhi’s strategic goal of positioning GIFT City as a prominent alternative trading center. With the implementation of blockchain technology, GIFT City can provide a competitive advantage by offering efficient, real-time transaction capabilities.The success of Onyx is evident, as the bank reportedly processed nearly $700 billion in short-term loan transactions through the platform as of April 2023. The utilization of Onyx for the interbank dollar transfers in India further demonstrates JPMorgan’s commitment to exploring the potential of blockchain technology in the financial sector.Positioning for de-dollarizationAdditionally, JPMorgan’s involvement in this initiative aligns with the evolving landscape of global finance. The bank’s currency strategists have highlighted signs of emerging de-dollarization, with the US dollar’s share declining in foreign exchange reserves and exports. The adoption of blockchain technology for dollar transactions not only improves efficiency but also aligns with the changing dynamics of the global financial system.As JPMorgan launches the pilot project in collaboration with the Indian banks, the coming months will be crucial for analyzing the experiences and outcomes. This initiative marks a significant step towards streamlining financial operations, embracing innovative solutions, and strengthening India’s role in the adoption of blockchain technology within its financial infrastructure.

Korean Travel Rule Solution Provider CODE to Start Charging Monthly Fees Next MonthSouth Korean Travel Rule solution provider CODE, established in collaboration between local cryptocurrency exchanges Bithumb, Coinone, and Korbit, has announced the implementation of service fees starting next month. Up until this point, CODE has been offering its services free of charge. The notification regarding this change was issued to CODE’s clientele, which includes various crypto exchanges, as reported by local tech news outlet Digital Daily.Photo by Kenny Eliason on UnsplashTravel RuleThe Travel Rule regulations, set by the Financial Action Task Force (FATF) and Korean legislation, require Korean trading platforms to maintain records of both the sender and recipient’s information for virtual asset transactions exceeding 1 million KRW ($780). The FATF, founded in 1989 and headquartered in Paris, is an international financial watchdog dedicated to combating global money laundering and terrorist financing.More competitive priceCODE is anticipated to offer its services at a more competitive price of 1 million KRW ($780), in contrast to its rival VerifyVASP (VV), which introduced a monthly fee of $1,800 earlier this year. VV is a product developed by Lambda 256, a subsidiary of Dunamu, the parent company of Upbit, the largest cryptocurrency exchange in Korea.CODE launched its services in March last year. Among its crypto exchange members are Gopax, Cashierest, and Coredax. In December, the Travel Rule solution provider appointed Lee Sung-mi, the former compliance officer of Bithumb, as its new CEO, and since then, it has accelerated its monetization plan. Prior to Lee’s appointment, Coinone CEO Cha Myung-hun had been at the helm of CODE.

China's authorities have dismantled an underground bank that illicitly utilized cryptocurrency for currency exchange operations between the Chinese yuan and the South Korean won, involving approximately 2.14 billion yuan ($295.8 million). China has a history of imposing strict capital control policies, prompting some individuals and entities to resort to cryptocurrency as a means of bypassing these regulations. According to a report published by local police in Northeast China’s Jilin province, six suspects were apprehended for their alleged involvement in facilitating the illegal operations spanning China and South Korea.Photo by Hyory Liu on UnsplashExploiting cryptocurrency featuresThe suspects purportedly took advantage of cryptocurrency features like transaction anonymity and decentralization to execute foreign currency exchange activities unlawfully. Investigations revealed that the criminal group utilized domestic accounts for fund receipt and transfer, alongside over-the-counter cryptocurrency transactions. Supporting illicit transactionsThe arrested individuals allegedly aided various entities, including South Korean purchasing agents, cross-border e-commerce platforms and import-export trade firms, in circumventing currency exchange regulations between the Chinese yuan and the South Korean won.