The finance industry in Korea is getting disrupted due to DeFi (Decentralized Finance). DeFi offers a different experience from traditional banking and opens up a world of possibilities for customers. Those that are driving the movement are Korean DeFi startups using Blockchain technology to cut the middleman. The middleman being traditional centralizes systems with limited speed, flexibility, and most of all transparency. DeFi has the potential to give users direct control over their money.
As DeFi uses Blockchain, everything is transparent. This will have a positive impact on due diligence, reduction of financial scams, and overall negative business practices. Korean banks understand the power of DeFi which is why all are looking into Blockchain technology. It is unlikely banks in Korea will not be needed but for sure the financial industry as a whole will be reshaped. In 2022 alone, DeFi project growth was up over 750% on the Ethereum blockchain.
Fintech startups in Korea have been growing due to the support of the Korean government as in the Seoul Fintech Lab. These startups are challenging traditional financial services companies by lowering transaction costs and greatly improving the user experience. However, they still need to rely on traditional centralized financial infrastructure. DeFi challenges not just the traditional financial infrastructure but also the fintech industry overall. Therefore, think of DeFi as a new system of exchange, savings, insurance, lending, and tokenization.
Think of a world where all financial services can be accessed through a smartphone and internet connection from anywhere. This is why Korean DeFi startups are changing the financial industry in Korea. They are building the fintech of the next generation by offering a clear regulatory framework and supportive innovation ecosystems.
In 2023, BLOCKO is focused on implementing a Blockchain solution for land registries in South Korea. They have already been working in conjunction with several national institutions such as Korea’s stock exchange, the Bank of Korea, Hyundai, and the Korea Electronics and Telecommunications Research Institute.
Blocko has raised over $20 million so far. Some of their investors include KEB Hana Bank, LB Investment, and Dadam Investment to name a few.
“Blocko is one of the few Blockchain companies globally that is actually supplying its platform to a slew of corporate clients. Overseas clients seem to be paying keen attention to our platform that has already been tested enough for immediate adoption,” said CEO of Blocko, Kim Won-beom.
Blocko will work with an Islamic Development Bank to build a Blockchain credit management system. The smart credit management system will be based on the Aergo hybrid blockchain. It will have an incentive mechanism that will encourage timely repayments and automatically contribute the fees to insurance pools that cover loan defaults. Furthermore, the system will help both Islamic banks and other financial institutions conduct credit assessments securely and transparently. This has the potential to have a significant impact on the world of Islamic finance.
Blocko will look to expand the Samsung Blockchain Service ecosystem in 2024. Moreover, they are one of the dApp sourcing partners of Samsung. Now developers will have access to list their dApps for Samsung Galaxy devices. The primary focus will be on DeFi applications which have been gaining transition in the Blockchain space.
ClaimSwap is a DeFi service on the Klaytn Blockchain. It allows users to swap various cryptocurrencies. All ClaimSwap’s code is made public and has been audited. It allows anyone to build their DeFi service with the ClaimWap protocol. The team behind ClaimSwap is constantly collaborating with third-party projects for the growth of the Klaytn ecosystem. On the Dapp, the governance token CLA determines all decisions on the protocol. Therefore, it is a protocol that is led by the community.
Baekdu Technologies is a Blockchain hedge fund that uses Blockchain technology and smart contracts to implement DeFi-specific strategies. This includes flash loans, interest accumulation, yield farming, carry trades, and cross-chain arbitrage. In addition, they are one of the few Korean DeFi startups pursuing system trading in the DeFi space. The fully automated trading program runs 24 hours a day, constantly looking for opportunities in the DeFi space. They do this by using over 50 Dapps.
InstaCoin offers consumers a way to pay without barriers. They offer a simple and secure payment solution that has both cash and coin integration. They have the world’s first patented QR Code-based mobile payment platform that provides both cash payment and INC payment options. It is the only mobile payment solution to be integrated with all banks in Korea. This is a solution to complicated credit card systems and offers merchants an alternative payment method. Furthermore, InstaCoin continues to bring on more coins and has already incorporated Seoul Pay, which is a Korean payment platform for 10 million Seoul citizens.
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