South Korea’s NH Bank Teams with Fireblocks to Develop Crypto Solutions for Tax Integration

Key takeaways

• NH Bank has partnered with Fireblocks to integrate blockchain technology into its financial services.
• Along with other South Korean banks, NH Bank is exploring blockchain to enhance operational efficiency, reduce errors, and improve security in financial services.
• NH Bank is expanding its blockchain initiatives beyond South Korea.

NH Bank Teams Up with Fireblocks for Blockchain-Driven Crypto Tax Solutions

Fireblocks, a blockchain technology provider, is working with South Korea's NongHyup (NH) Bank to support a new crypto project the bank is developing. NH Bank selected Fireblock specifically to help create a prototype system for handling digital assets.

The two companies formalized this partnership by signing a memorandum of understanding (MoU), a non-binding agreement that outlines their plan to work together on this project.

NH Bank intends to use Fireblocks' Tokenization Engine, a tool designed to manage digital assets since it incorporates crypto solutions into various financial services.

This includes potential uses in processes like VAT (Value-Added Tax) handling and Tax refunds, as well as managing generation-skipping transfer taxes, which apply to asset transfers across generations.

Lee Seok-yong, NH Bank's president, highlighted this partnership as a big step forward. The bank aims to bring blockchain-based services to its customers. Lee also mentioned that the bank plans to add more digital asset options soon.

NH Bank isn't the only bank exploring blockchain. Shinha Bank, another large South Korean bank, is testing blockchain to reduce human errors.

Other major banks around the world have also introduced crypto services. This trend shows that many banks see blockchain as a way to improve accuracy and efficiency in financial services.

Many consider South Korea one of the largest cryptocurrency markets in the world. Many major crypto companies, such as Bithumb and Upbit, are based in South Korea. The country has taken early steps to regulate the crypto industry, setting it apart as a leader.

Blockchain for Efficient Tax Refunds and Streamlined Financial Services

In recent years, South Korea introduced new laws to better control and monitor crypto activities. These regulations focus on protecting consumers and ensuring that virtual asset service providers follow strict guidelines.

Michael Shaulov, CEO and co-founder of Fireblocks, said the latest partnership is a major step. It shows how blockchain can be used for financial services, like tax refunds. This move could lead to more secure, blockchain-based solutions in banking.

The value-added tax (VAT) in South Korea is set at 10%. The fees for processing a VAT return range between 3% and 6%. Using blockchain for VAT refunds could make the process faster and more efficient, saving costs for both banks and customers.

Fireblocks have played a big role in crypto asset transfers, enabling the movement of a massive $6 trillion worth of digital assets. The company provides secure solutions for moving and storing crypto, attracting many clients who rely on it to safeguard their assets.

Its customer list includes major players across different sectors of finance. Among these players, there are the cryptocurrency exchanges, lending desks, custodians, and banks.

Besides working on a tax refund pilot project, NH Bank plans to explore other areas in the financial ecosystem where blockchain technology could improve. This might involve finding ways to make banking services faster, safer, or more efficient with the help of blockchain.

NH Bank is also interested in building partnerships beyond South Korea. It aims to work with other banks and financial institutions worldwide. This approach could open doors for global blockchain-based financial services and encourage international collaboration.

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