27 Financial Firms Form Korean Blockchain Consortium

A new blockchain consortium has been formed in South Korea, with both established finance firms and technology startups on its membership roster.

According to one of the group's members – blockchain startup The Loop – the new initiative will focus some of its efforts on building tools for managing trade finance processes.

The firm said in a statement:

“Beyond providing [the] blockchain-based authentication and information sharing system, we collaborate with other technology providers on developing a prototype for financial services in areas of securities trade and post trade, the prototype that is to reduce the cost and operational risk in trade finance, and ultimately improve trade efficiency."

Some of the consortium's members, including Daishin Securities, have already pursued blockchain applications of their own or in tandem with regional startups. However, the consortium effort, with a current membership of 27 companies, takes those efforts one step further.

Other members of the new group include Dongbu Securities, Yuanta Securities Korea and Kiwoom Securities.

The blockchain effort was organized in part by the Korea Financial Investment Association, an industry trade group in South Korea.

Government interest

The new initiative is the second of its kind in South Korea, and its formation last week comes on the heels of a separate consortium initiative spearheaded by the South Korean government.

In late October, the East Asian country's government began putting the pieces in place for its public-private consortium, back by major South Korean banks and their top regulator, the Financial Services Commission (FSC).

"With the creation of the consortium, momentum is expected to start for spearheading the development of technology and service in the blockchain field, rather than passively following the footsteps of advanced nations," FSC chairman Kim Yong-beom was quoted as saying by regional news service Yonhap at the time.

Specific elements of the government-backed consortium include the formation of a task force drawn from the banking sector and other agencies that would ostensibly regulate the technology. Forums for information sharing and joint development of projects are also planned.

Perhaps most notably, the government has expressed interest in seeking solutions to potential regulatory problems in conjunction with the consortium, suggesting that the group could become a focal point for blockchain development in South Korea.

Seoul, South Korea, image via Shutterstock