Why it matters:
The agreement came after BitGo secured $100 million in Series C funding in August at a valuation of $1.75 billion.
As BitGo opens its Seoul office, the agreement with the financial institution becomes more market-focused.
The Key Points
Changing regulatory environment in South Korea
In December 2022, the Bank of Korea emphasized the need for independent and trustworthy digital asset custodians, citing potential conflicts of interest when virtual asset exchanges take on custodial roles.
South Korea is updating the Electronic Securities Act and the Capital Market Act to include security token offerings (STOs).
Several Korean securities firms are preparing to launch STOs backed by tangible assets, including real estate and intellectual property.
Therefore, a highly reliable digital asset custodian with guaranteed independence in custody operations is essential for the growth of the digital asset market.
In line with BitGo's entry into the South Korean business and establishment of a legal entity in South Korea, Hana Bank will jointly enter the digital asset custody business.
BitGo Korea is expected to be fully operational in the second half of 2024 after ISMS certification and VASP registration are completed.
The business agreement will initially consider joint equity investment through establishing a joint venture company.
It will leverage BitGo's security solutions and digital custody technology and Hana Bank's financial services expertise and security compliance.
About BitGo's Progress
BitGo is known for innovating the multi-signature wallet and, later, the TSS (Threshold Signature Scheme).
The company boasts the most secure technology, protecting over 600 tokens on multiple blockchains.
Expanding its repertoire from wallets, BitGo now offers holistic solutions for customers to store and optimize their assets securely.
2018 saw the launch of BitGo Trust Company, a regulated entity offering cold storage.
This was followed by the introduction of BitGo Prime in 2020, which facilitates trading, borrowing, and lending activities for customers.
BitGo is the exclusive custodian for WBTC (wrapped bitcoin) and handles approximately 20% of global bitcoin transactions by value.
The Big Picture
BitGo's business agreement with Hana Bank comes as South Korea revises the Electronic Securities Act and the Capital Market Act to include STOs.
Currently, securities firms in South Korea are preparing to launch STOs based on various real-world assets such as real estate, artwork, and music copyrights.
BitGo's current presence in the South Korean market is a testament to the value they place on it.
The partnership follows BitGo's $100 million Series C funding, which values the company at $1.75 billion in August 2023.
"BitGo's platform, together with Hana Bank, will significantly contribute to the South Korean market and build a long-term foundation for the South Korean market with the upcoming development of the STO market."
Mike Belshe, CEO of BitGo
BitGo has processed $3 trillion in transaction value over the past decade.