South Korean experts say that domestic business big-hitters like Samsung and LG are stepping up their crypto-related activities with overseas companies – rather than domestic players – as part of a strategy that has begun to take shape in the past few weeks.
As previously reported, Samsung last week struck a deal with American crypto exchange player Gemini. The deal saw Samsung integrated Gemini exchange functions for its flagship Galaxy smartphones equipped with Blockchain Wallet features in both the United States and Canada – allowing users to buy and sell crypto, and make use of Gemini Custody cold wallet storage functions.
LG, meanwhile, has recently become a member of the governance council of the Dallas-based Hedera Hashgraph (HBAR) project, also agreeing to run a node on the latter’s network.
The COVID-19 outbreak has forced many companies to explore contact-free technological solutions and business models – and bigger South Korean companies see cryptocurrencies as being a key part of this.
The media outlet quotes an unnamed industry insider as stating that big companies like LG and Samsung are keen to tap into the potential of crypto, but would prefer to partner with strong and high-potential players in the United States, where they feel the market is already in an advanced state.
Regulatory issues are a third factor, per the report.
The media outlet quotes another unnamed South Korean industry chief as stating,
“Due to regulatory uncertainty and the government’s reluctance to cooperate, large domestic companies are choosing not to pursue cooperation with domesticcompanies.”
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The same insider stated that although the National Assembly’s passed a potentially groundbreaking crypto-specific legal amendment in March this year, big South Korean firms are not convinced.
The industry chief stated that South Korean crypto regulation was “still inferior” to the regulatory frameworks in countries such as Japan and the United States.
One crypto-keen domestic player that both Samsung and LG do have strong relationships with is tech giant Kakao.
The latter yesterday launched a crypto wallet that is integrated with its 50+ million-user KakaoTalk app. LG and its subsidiaries are governance council members of Kakao’s Klaytn blockchain project, while Samsung’s smartphone blockchain wallet is also compatible with Klaytn’s native Klay token.