Blockchain technology continues to be of great interest to financial institutions all over the world. Although there is a lot more in the way of speculation than working products right now, that’s slowly changing in South Korea. More specifically, the country’s online banking industry just received a major blockchain-based security upgrade. Amazingly, it is its first major improvement in two decades.
Blockchain Makes Korean Online Banking More Secure
It is evident the blockchain industry could have a major impact on the Korean banking industry as a whole. More broadly, it could affect any financial sector in any country on the planet. It seems South Korea is simply ahead of the curve in this regard, which will come as a surprise to a lot of people. Then again, the Korean online banking sector hasn’t seen any major security updates in two decades.
That in itself is pretty worrisome. Banks are designed to keep customer funds safe at all times, yet they hardly ever succeed in doing so. Without security updates, it becomes all the more difficult for financial institutions to do the job they were designed for. At the same time, the lack of security updates is usually due to a lack of funding or blatant ignorance. It is unclear which was the case in South Korea, but it is good to see an update finally arrive.
This doesn’t mean the new blockchain-based solution will result in visible changes, though. In fact, most consumers won’t even know they are benefiting from the blockchain, which is only to be expected. What they will notice is how there will be a new form of online identification, known as Chain ID. This particular tool was developed by theloop, an industry leader in blockchain-based security. Creating new security standards is the end goal, but doing so will be difficult to achieve, for obvious reasons.
One of this solution’s benefits is that consumers can use the same “certificate” across several dozen banks and securities companies that are part of the Korea Financial Investment Blockchain Consortium. For now, the number of such companies is just 25, although more growth is expected over the next few months and years. Prior to now, personal identification certificates had to be used in conjunction with Windows-only software, which served to make the whole process more cumbersome than it needed to be.
For now, the goal is to introduce Chain ID on mobile devices. Android and iOS support will roll out over the coming days and weeks. Desktop support for Windows and MacOS will follow shortly thereafter. It will be an interesting experiment for this innovative technology, as it is one of the first consumer-oriented projects to come to market in this part of the world. A successful trial could have positive consequences, although there is no need to get ahead of ourselves.
Interoperable blockchain certificates are an interesting development in the world of finance. Although it remains to be seen if this project can be successful, its introduction in South Korea’s banking sector is a pretty big development in its own right. For all the hype surrounding blockchain in the banking sector these days, there is still very little to show for it. That is finally coming to change, by the looks of things.