Shinhan Bank Says Digital Assets Have Moved Beyond Experiment Phase, Expanding Banks’ Role

Digital assets have moved beyond the experimental stage and are entering a phase of real-world use in financial transactions, according to an executive at Shinhan Bank. That shift means banks need to define their role in the market.

Kim Byung-hee, head of Shinhan Bank’s Digital Asset Cell, made the remarks on October 23 at the Korea Financial Telecommunications & Clearings Institute’s 40th anniversary event, the Payment Insight Seminar, held at the Korea Chamber of Commerce and Industry in central Seoul.

Kim said the use of digital assets is expanding rapidly. JPMorgan’s blockchain payments network, Kinexys, has processed more than $4 trillion in cumulative transaction volume, while its average daily volume has risen to about $7 billion, he said.

Tokenization is central to that shift. It can narrow the time gap between trading, payment and settlement for financial products. As a result, financial transactions are moving away from a traditional sequential process toward a structure in which multiple steps can take place simultaneously.

Kim also said the banking industry needs to respond to those changes. If digital assets are adopted, banks will need to choose the remittance method and network that best serves customers in payments. In lending, the way banks assess and manage collateral will also change to reflect tokenized assets. Banks’ core functions will remain the same, but their existing role will expand, he said.

What matters is not simply creating new digital-asset services, Kim said. The priority is to provide the services customers actually need. That will require banks to accurately identify demand in areas such as 24-hour remittances, optimized foreign exchange and wealth management, and to quickly develop new financial services.