Korea Digital Asset (KODA), the largest institutional crypto custody service in South Korea, announced on Thursday that the value of crypto assets under its custody expanded by nearly 248% in the second half of 2023.
KODA — jointly set up by major Korean bank KB Bank, crypto venture capital firm Hashed and blockchain tech firm Haechi Labs — said in a statement that the value of the assets under its custody grew to around 8 trillion Korean won ($6 billion) at the end of last year from 2.3 trillion won at the end of June 2023.
Meanwhile, the price of bitcoin rose 38% in the latter half of 2023, driven by factors including investors’ excitement about the spot bitcoin exchange-traded fund launch in the U.S., which took place in January this year. Bitcoin was trading at around $51,770 at 5:15 p.m. on Thursday Hong Kong time, up 0.6% over the past 24 hours, according to The Block’s price page. The GMCI 30 Index — representing the performance of the top 30 cryptocurrencies — rose around 42.5% in the second half of last year.
South Korea currently restricts institutions and corporations from directly investing in crypto via exchanges, while crypto custodians have offered institutional investors a regulated window for managing crypto assets.
The firm’s market share in the local crypto asset custody sector reached 80% at the end of June 2023, according to KODA, which cited a report from the Korea Financial Intelligence Unit. KODA said that it currently serves around 50 corporate clients, managing over 200 wallets.
Spot Bitcoin ETF possibility
The demand for crypto custody services could rise even further in the future, KODA said in the statement.
Earlier this week, both the ruling and opposition parties in South Korea announced that they plan to pledge the launch of local spot bitcoin exchange-traded funds (ETF) as their election promises ahead of the general election on April 10. Both parties also vowed to lift the ban that restricts institutional investments in crypto.
“In view of the flow of global capital markets such as the U.S. and Hong Kong, the institutionalization of digital assets is already irreversible, and I think KODA will play a key infrastructure role if the bitcoin spot ETF is approved in Korea,” Cho Jin-seok, chief executive officer of KODA, said in the release.
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