Jeonbuk Bank launches Bitcoin-backed corporate loans in South Korea

Jeonbuk Bank, a subsidiary of JB Financial Group, has reportedly issued South Korea’s first traditional bank loans secured by Bitcoin. The lending arrangement is specifically limited to corporate borrowers seeking working capital for operational expenses such as payroll and supplier payments. Individual borrowers are not eligible for this service.

A key feature of this arrangement is that the bank does not take direct custody of the Bitcoin. Instead, licensed third-party custodians safeguard the pledged digital assets while the bank manages credit assessments and loan issuance. This structure follows recent amendments to South Korea’s Civil Enforcement Rules, which became effective on October 1. These rules allow for court-supervised recovery and the liquidation of virtual assets in the event of a default, enabling the bank to recover funds through court-ordered sales without possessing the cryptocurrency directly.

Specific details regarding loan amounts, interest rates, and loan-to-value requirements have not been publicly disclosed by the bank.