Jeonbuk Bank launches Bitcoin-backed corporate loans
- Jeonbuk Bank has introduced South Korea’s first bank loans backed by Bitcoin for corporate customers.
- Borrowers can access Korean won for business operating costs, with Bitcoin held by a specialist custodian.
- The bank uses multi-exchange pricing and court-supervised liquidation procedures to manage collateral and recover unpaid loans.
Jeonbuk Bank has launched South Korea’s first corporate loans backed by Bitcoin (BTC), according to an exclusive report by Edaily.
The service initially targets businesses seeking working capital and limits eligible collateral to Bitcoin, citing its market liquidity and pricing data.
“This loan is an example of designing a risk management and recovery structure that allows us to utilize existing bank lending and collateral management systems without directly holding virtual assets, all within the framework of current laws and regulations,” Jeonbuk Bank Digital Division Executive Vice President Jeong Sang-hoon said in a statement.
A specialist custodian holds the Bitcoin, while Jeonbuk Bank manages lending and collateral valuation without directly controlling the assets.
The bank calculates collateral values using weighted average prices from multiple global exchanges and median market volatility indicators.
If a borrower defaults, court-supervised sale procedures allow the collateral to be liquidated, with proceeds used to recover the outstanding loan.
The launch follows South Korea’s amended civil enforcement rules, effective 1 October, which establish procedures for seizing and liquidating rights linked to virtual assets.
The launch allows South Korean businesses to borrow Korean won against Bitcoin collateral to fund operating expenses.
