South Korean mobile commerce leader Omnitel announced that its subsidiary Omni Networks is starting a bitcoin remittance business. In addition, the company plans to accept the digital currency for its video streaming service.
Also read: South Korea to Dispose of 216 Bitcoins in First Public Auction
Revised Bill Paves the Way for Omnitel
The revised bill of the Enforcement Decree of the Foreign Exchange Transactions Act of South Korea was finalized on Tuesday, according to Money Today. The amendment provides legal grounds for fintech companies to engage in remittance businesses, which was previously only available to commercial banks.
Among companies taking advantage of this amendment is Omnitel, a South Korea-based mobile commerce leader. Established in 1998, the company specializes in mobile broadcasting service and various public services such as disaster alerting service by utilizing the cell broadcasting system platform. Omnitel is a public company listed on Kosdaq, the Korean counterpart of Nasdaq, with 7.77 billion won in capital and about a 70 billion won market cap at press time. In addition to South Korea, the company operates in Algeria, China, Mongolia, Myanmar, Singapore, Malaysia, Vietnam, Thailand and Indonesia.
Omnitel sells over 70 brand coupons through its network, accounting for over 1,200 products. It streams over 10 media channels and has more than 400 partners, including South Korea’s largest credit card company Samsung Card, wireless telecommunications operator SK Telecom, Hyundai, and Lotte Card. Products and brands include Starbucks, Baskin-Robbins, CVG cinemas, 7-11, the Outback Steakhouse and the largest health care and beauty care chain store in Asia, Watsons. Omnitel is actively working on a smartphone app and services.
Omnitel Adds Bitcoin Services
In line with the newly revised law, Omnitel announced that its subsidiary, Omni Networks (formerly Omni Bank), has entered into a cross-border payments business, according to Money Today.
In March, the company announced an investment of 2.4 billion won to acquire an 8.89% stake in BTC Korea.com, the operator of the country’s largest bitcoin exchange by volume, Bithumb. Omnitel said at the time that Bithumb accounts for 70% of the domestic bitcoin trading market, with accumulated trading volume of 2 trillion won in 2016 since the exchange began trading in January 2014. Its daily transaction amount exceeded 3.5 billion won on January 5, earning the operator 4,181 million won in sales and net profit of 2,513 million won, the company detailed.
Following this investment, Omni Networks started working on a bitcoin-based foreign exchange (FX) remittance business. The standard FX remittance fees and FX margins charged by banks in South Korea are between 5% and 7%, the company described, adding that it wants to lower commissions to between 8,000 and 13,000 won and FX margins to less than 2%. Moreover, it plans to shorten the transfer time from two to three days to less than one hour.
In addition, Omnitel plans to introduce bitcoin payments for mobile streaming content, which it says will differentiate itself from competitors. Bitcoin has been the company’s priority since its price spikes drove high demand in Asia. An Omnitel official said that the company’s first goal is “to rapidly enter the overseas remittance and mobile settlement market.”
What do you think about Omnitel entering the Bitcoin space? Let us know in the comments section below.
Images courtesy of Shutterstock, Omnitel, Bithumb
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