Bitcoin

<p>Recently, the top five Korean banks have seen a significant outflow of funds in their demand deposits – worth about KRW 2 trillion ($1.52 billion) – to crypto markets as local investors are rushing to withdraw their money from banks to invest in the crypto and stock markets. The recent surge of Bitcoin to KRW 100 million prompted the funds’ outflow, local media Etoday <a href="https://www.etoday.co.kr/news/view/2339342" rel="noopener noreferrer nofollow">reported</a>. This is a substantial turn from just a week ago, when these banks saw a KRW 23.5 trillion increase in their demand deposits just in a month.</p><p><a href="https://coinness.com/en/news/2816" rel="noopener noreferrer nofollow">The previous rise</a> in demand deposits at banks, however, was also driven by local investors who used these accounts as a “station” to temporarily store their money for future crypto investments. These accounts are highly liquid, since users can deposit or withdraw funds at any time without incurring penalties from banks.</p><h3 id="bank-deposits-flowing-into-crypto">Bank deposits flowing into crypto</h3><p>Data from the five banks –  KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank and NH Nonghyup Bank – show that their combined demand deposits totaled KRW 612.4 trillion on Friday, down KRW 2.2 trillion from late last month.</p><p>The crypto investing trend has prompted investors to withdraw their funds not only from demand deposit accounts, but also from fixed deposit and installment savings accounts. During the same period, the five banks’ fixed deposits saw a KRW 5.1 trillion decline from KRW 886.2 trillion to KRW 881 trillion, with installment savings decreasing by KRW 2.5 trillion, from KRW 33.2 trillion to KRW 30.6 trillion.</p><p>In particular, NH Nonghyup Bank, which offers real-name accounts to the crypto exchange Bithumb, has witnessed a decline of over KRW 2 trillion in its demand deposits over the past week. Shinhan Bank also reported an increase in dealing with more crypto assets.</p><h3 id="bullish-crypto-and-stock-market">Bullish crypto and stock market</h3><p>With Bitcoin prices hitting a new high, the U.K. bank Standard Chartered forecasts that Bitcoin could eventually reach $200,000 by 2025. The excitement around crypto has boosted the amount of cryptocurrencies traded against the Korean won across the top five crypto exchanges in Korea, reaching KRW 78 trillion.</p><p>Korean stock markets are also signaling a bullish sentiment, with the amount of investor deposits exceeding KRW 53 trillion this month. Investor deposits refer to customer deposits at securities companies saved for investment purposes or those left unclaimed after selling stocks.</p><h3 id="declining-interest-rates">Declining interest rates</h3><p>Meanwhile, local savings products with over 4% interest rates are no longer to be seen. According to the Korea Federation of Banks, a one-year savings product with the highest interest rate among the top five local banks offers an annual rate of 3.55%.</p><p>Online-only banks, which typically offer relatively higher rates than other traditional banks, are rapidly lowering rates on their saving products. The highest annual rate for Kakao Bank’s fixed deposits products stands at 3.5%, down by 0.1 to 0.2 percentage points depending on their maturity.</p><p>Kbank has also decreased rates for fixed deposits by 0.05 percentage points, lowering the rate for its flagship fixed deposits product from 3.7% to 3.65%.</p>

Korean banks see over $1.5B outflow in funds to crypto market

Table of Contents

CoinNess Global

Other articles published on Mar 13, 2024

THORChain Price: Why is RUNE Price Rallying?

Market Analysis: Bitcoin Holds Firm as Altcoins Navigate Turbulence

Whale moves over $20M PEPE from Binance, What’s the buzz?

Bonk Price Explodes By More Than 110% So Far in 2024 - 3 Best Meme Coins to Buy Next

XRP To Skyrockets To $1.33 Amidst April Rally: Analysts

Nigeria’s Crackdown On Binance Escalates: Authorities Demand For Top 100 User Details

Join our free newsletter for daily crypto updates!