Real-Name Bank Accounts for Crypto Trading in South Korea: How It Works and Who Can Use It

South Korea doesn’t just regulate cryptocurrency-it ties it directly to your real name, your bank account, and your government ID. If you’re trying to trade crypto here, you can’t just sign up with an email and a password. You need to prove who you are, link your bank account, and jump through hoops most other countries don’t even ask for. This isn’t a suggestion. It’s the law. And it’s changed how crypto works in one of the world’s most active digital asset markets.

Why South Korea Demands Real Names for Crypto

In 2018, South Korea came close to banning cryptocurrency entirely. The Justice Minister at the time, Park Sang-ki, said digital assets were a threat to financial stability. But over 220,000 citizens signed a petition demanding a better solution. The government didn’t shut it down. Instead, they built one of the strictest crypto systems on Earth: the real-name bank account system.

The goal? Stop money laundering, prevent fraud, and make sure every trade can be traced back to a person with a Korean ID number. The Financial Services Commission (FSC) and the Financial Intelligence Unit (FIU) made it clear: no anonymous trading. No offshore wallets. No bypassing the system. Every deposit and withdrawal must go through a verified bank account in your legal name.

This isn’t just KYC like in the U.S. or Europe. This is full integration. Your bank and your crypto exchange share your data. If the exchange doesn’t send transaction logs to the bank, the bank freezes everything. No warnings. No second chances.

How the System Actually Works

It’s not complicated to use-if you’re a South Korean citizen. Here’s the step-by-step:

1. Open a real-name bank account at one of the approved banks: Shinhan, K-Bank, Kookmin, Kakao, or Woori.
2. Sign up on a crypto exchange that’s partnered with that bank. Korbit uses Shinhan. Upbit uses K-Bank. Bithumb uses Kookmin. Coinone uses Kakao.
3. Verify your identity with your national ID card and phone number.
4. Link your bank account to your exchange account. The system checks your name, ID, and bank account number against government databases.
5. Deposit Korean Won (KRW) from your bank to the exchange. The transfer must come from the exact same name and account.
6. Trade crypto. Withdrawals go back to the same bank account.

Deposits usually clear in under 30 minutes. Withdrawals take a bit longer, but they’re still faster than most international crypto transfers. The system is designed for speed-within strict boundaries.

You can’t use someone else’s account. You can’t use a joint account unless your name is on it. You can’t use a foreign bank. And if you try to send money from an unlinked account? It gets rejected. Automatically. No human review. No appeal.

Who Can Use It? (Spoiler: Not Many Foreigners)

This is where it gets hard.

If you’re not a South Korean citizen, you’re practically locked out. To open a real-name bank account, you need:

• A permanent resident visa or long-term visa (over one year)
• An Alien Registration Card (ARC)
• A Korean mobile number registered in your name
• A Korean address

Most tourists, students on short-term visas, or digital nomads can’t meet these requirements. Even if you have a Korean bank account, most exchanges won’t let you link it unless your name matches your ARC exactly-and even then, some banks still block crypto transfers.

International exchanges like Binance or Coinbase don’t work with KRW. You can’t deposit Korean Won directly. You can’t use a foreign credit card. You can’t use PayPal or Wise to fund your account. The only way in is through a Korean bank account-and only if you’re legally allowed to have one.

That means the vast majority of foreign crypto traders can’t access the South Korean market. It’s not a technical issue. It’s a legal wall.

Which Exchanges Are Approved?

Not every exchange can operate in South Korea. As of April 2025, only five exchanges have been granted verified real-name bank accounts by the FIU:

• Korbit - partnered with Shinhan Bank
• Upbit - partnered with K-Bank
• Bithumb - partnered with Kookmin Bank
• Coinone - partnered with Kakao Bank
• Gopax - partnered with Woori Bank

There are 28 Virtual Asset Service Providers (VASPs) registered with the FIU, but most of them don’t have bank partnerships. Without a bank link, they can’t accept KRW deposits. That means they’re effectively shut down for retail trading.

If you’re trading on an unapproved exchange, you’re not just taking a risk-you’re breaking the law. The government doesn’t go after individual traders, but they shut down exchanges fast. In 2021, several smaller platforms were forced to close after failing compliance checks.

What About Taxes?

South Korea doesn’t just track your trades. It’s going to tax them.

Starting in 2027, any individual who makes a profit from trading crypto will pay income tax on it. The rate? Up to 24.2%, depending on your total income. This isn’t a capital gains tax-it’s treated as regular income.

For corporations, the rules are even stricter. Foreign companies earning income from Korean crypto trades will now be taxed as if they’re operating inside South Korea. That means if you run a crypto fund from Singapore but trade KRW pairs on Upbit, you owe taxes in Korea.

The government is also collecting up to 24.2% in corporate and local income taxes from exchanges themselves. That’s one of the highest tax burdens on crypto businesses in the world.

Pros and Cons of the System

Pros:

• Extremely low fraud and scam rates compared to other markets
• High trust in exchanges because they’re regulated and bank-linked
• Easy to trace illegal activity-money laundering is rare
• Market is stable and growing: over 12 million Koreans are expected to hold crypto by 2025

Cons:

• Foreigners can’t participate without residency
• No privacy-every trade is tied to your ID
• Only five exchanges can accept KRW, limiting choice
• Language barrier: most support and documentation is in Korean
• High compliance costs for exchanges, which get passed to users

The system works great for Koreans. It’s safe, fast, and transparent. But it’s designed for one group: South Korean citizens. Everyone else is on the outside looking in.

What If You’re a Foreigner and Still Want to Trade?

If you’re not a resident, there’s no legal way to use the Korean crypto market. Some try to use friends’ accounts or fake documents. That’s risky. Banks and exchanges are required to report suspicious activity to the FIU. If caught, you could face fines, account freezes, or even deportation.

Your best option? Trade crypto on international exchanges using Bitcoin, Ethereum, or stablecoins. Use a non-Korean bank account. Don’t try to route money through Korea. It’s not worth the legal risk.

Some traders use peer-to-peer (P2P) platforms to buy KRW from Koreans, but that’s also against the rules. The government is cracking down on these deals too.

The Bigger Picture

South Korea’s real-name system is a model for other countries thinking about crypto regulation. Japan, Singapore, and even the EU have looked at it as a blueprint for anti-money laundering controls.

But it’s also a warning. When you make crypto too hard to access, you push innovation elsewhere. While Korea’s market is growing-projected to hit $635 million in revenue by 2030-it’s mostly domestic. Foreign investment and global liquidity are limited because the doors are locked.

The government says security comes first. And in many ways, it does. But at what cost? If you can’t attract global traders, you’re not building a market-you’re building a closed system.

For now, if you’re Korean, you’ve got one of the safest, most regulated crypto environments in the world. If you’re not? You’ll need to look elsewhere.

What’s Next?

The 2027 tax changes will be a major test. Will people stop trading? Will they move to offshore platforms? Will exchanges start pushing for more flexibility?

The FIU says it’s open to registering more VASPs-but only if they meet the same strict standards. No shortcuts. No compromises.

One thing’s certain: South Korea won’t loosen its grip on crypto anytime soon. The real-name system isn’t going anywhere. It’s not a phase. It’s the new normal.