Upbit partner KBank to test onchain cross-border remittances with Ripple

KBank, South Korea's internet-only bank and a partner of Upbit, announced Monday that it has entered into a strategic partnership with Ripple.

According to multiple local media reports, the two companies will collaborate on a proof-of-concept to assess potential improvements in the speed, cost, and transparency of cross-border transfers. The PoC is designed to utilize Ripple's blockchain infrastructure and global network.

KBank and Ripple have already completed the first phase of the PoC, in which they verified a wallet app-based remittance system. In the ongoing second phase, the two will reportedly test the stability of onchain remittances in a virtual setup, including transfers to other countries such as the UAE and Thailand.

For the second verification phase, KBank is using Ripple's software-as-a-service wallet app, Palisade, which is already compliant with international security standards, according to the reports.

The partnership may reportedly expand to support KBank's live cross-border remittance system and further initiatives in digital assets.

This announcement is part of a wave of partnerships between major financial players in South Korea and global blockchain companies, ahead of the upcoming Digital Asset Basic Act — the country's all-encompassing set of rules for cryptocurrencies. Earlier this month, Ripple partnered with Kyobo Life Insurance for tokenized government bond transactions through Ripple Custody.

Meanwhile, KBank is the sole banking partner for Upbit, where all users of the crypto exchange must sign up with the bank to trade fiat for crypto due to local regulations. The partnership with Upbit was integral to KBank's exponential growth over the past five years, with the number of users expanding from around 2 million in 2020 to 15 million as of the end of last year.