The competition for the Korean won stablecoin has officially begun: bank alliances, tech giants, and Web3 companies are all entering the fray. Who will take the lead first?

Author: Zen, PANews

Before officially taking office, South Korean President Lee Jae-myung clearly proposed in his campaign program to support the innovative initiative of "local currency-pegged stablecoins," aiming to curb wealth outflow and enhance the competitiveness of the domestic digital financial ecosystem. After the Lee Jae-myung government came to power, the South Korean cryptocurrency industry immediately began to "stir": not only are eight major commercial banks preparing to launch a joint project for a Korean won stablecoin, but traditional tech giants and Web3 companies are also making moves to seize the initiative in the increasingly fierce regional and even global stablecoin competition.

At the same time, the National Assembly is reviewing the "Basic Law on Digital Assets," which will provide a legal basis for private institutions to issue Korean won stablecoins, and financial regulatory authorities are also accelerating the establishment of operational norms in line with international standards. It can be seen that the second half of 2025 to the first half of 2026 may be a "explosive" growth window for the South Korean stablecoin market. This article systematically sorts out and deeply analyzes the main participants, business models, and innovative trends in the South Korean stablecoin market, focusing on several potential issuers.

South Korean Bank Alliance

Due to the significant impact that the introduction of stablecoins may have on monetary policy and transaction settlement systems, the Bank of Korea, while recognizing the innovative and facilitative role of stablecoins in the fintech sector, has expressed concerns about their potential as a substitute for legal tender. Bank of Korea Governor Lee Chang-yong stated in mid-June that the central bank is working with relevant institutions to develop a regulatory framework for stablecoins to ensure their stability and practicality while preventing their use for circumventing foreign exchange controls. Lee Chang-yong also expressed a cautious attitude towards the Korean won stablecoin. Bank of Korea Governor Lee Chang-yong

Under this cautious policy direction, the most competitive participants in the Korean won stablecoin sector are currently the banking institutions. According to a report by Reuters on June 24, Ryoo Sang-dai, the senior deputy governor of the Bank of Korea, stated at a press conference that stablecoins pegged to the Korean won should ideally be introduced gradually and should first be issued by strictly regulated commercial banks. After accumulating sufficient experience, the scope can gradually expand to the non-bank sector to mitigate impacts on monetary policy and payment systems.

On June 25, South Korean media outlet "Economic Review" reported that eight major banks in South Korea plan to prepare for the establishment of a joint venture to issue Korean won stablecoins, with participating banks including KB Kookmin Bank, Shinhan Bank, Woori Bank, NH NongHyup Bank, Industrial Bank of Korea, Suhyup Bank, Citibank Korea, and Standard Chartered Korea. Additionally, the Open Blockchain and Decentralized Identifier Association (OBDIA) and the Korea Financial Telecommunications and Clearing Institute (KFTC), a non-profit organization responsible for Korea's interbank payment infrastructure, will participate in coordination and cooperation.

It is reported that the project team is considering two stablecoin issuance models: one is a trust model, where customer funds are first held in trust before issuing stablecoins; the other is a deposit token model, linking stablecoins to bank deposits. Currently, the aforementioned banks are discussing the joint construction of infrastructure, and the joint venture could be established as early as the end of this year or early next year after the legal framework is improved.

According to disclosed information, among the eight banks, KB Kookmin Bank, the largest retail bank in South Korea, is the most actively involved in the stablecoin layout. It has taken the lead in initiating the process of acquiring trademarks related to stablecoins, with proposed trademarks including combinations of "KB" and the Korean won symbol "KRW," such as KBKRW, KRWKB, KBST, and KRWST. This move by KB Kookmin Bank marks the first formal major entry of a traditional bank into the stablecoin field in South Korea. The bank has a network of over 1,000 branches and a large personal customer base, making it a core leader in this joint venture in terms of both commercial scale and layout.

Shinhan Bank, alongside KB Kookmin Bank, is a leader in the South Korean retail market and has made multiple attempts to connect with virtual assets in recent years. It was one of the first to collaborate with Hedera in 2021 for a Korean won stablecoin pilot to determine whether it could issue and distribute stablecoins for financial use cases at lower costs and shorter completion times than existing systems, while also ensuring transaction traceability. In 2022, Shinhan Bank also issued virtual accounts to some enterprises that could trade virtual assets. In April of this year, the bank participated in a stablecoin-based remittance demonstration project between Korea and Japan—"Project Pax," initiated by Japan's Programat, Korea's Fair Square Lab, and Korea's digital asset custody institution (KDAC)—aimed at building the next generation of global remittance and payment systems using digital assets.

Additionally, Woori Bank, NH NongHyup Bank, and others also have rich international payment experience and have played important roles in CBDC testing, interbank RTGS, and blockchain projects; Industrial Bank of Korea has been deeply involved in SME credit and trade financing for many years, providing cost advantages for enterprise-level application scenarios; Standard Chartered and Citibank Korea can leverage their parent banks' international networks to provide overseas clearing and offshore liquidity support for stablecoins.

Kakao Pay and Kaia

As a leading company in the South Korean payment sector, Kakao Pay is the most proactive among major players in the layout of Korean won stablecoins.

Founded in 2014, Kakao Pay relied on the Kakao Talk instant messaging app to surpass 10 million users in just 20 months, and in 2017, it received a $200 million strategic investment from Ant Financial, establishing its leading position in the South Korean mobile payment market. By mid-2025, Kakao Pay's penetration rate in online and offline QR code payments, P2P transfers, and e-commerce settlement scenarios in South Korea has exceeded 60%. In terms of market share and active user scale, its position in South Korea is comparable to that of Alipay and WeChat Pay in China.

After the pro-cryptocurrency Lee Jae-myung took office, the Kaia team quickly announced plans to collaborate with Kakao Pay, LINE NEXT, and other super apps to launch a Korean won stablecoin. Following the announcement, Kakao Pay's stock price surged nearly 30%. On June 22, Kakao Pay officially launched its Korean won stablecoin business layout, intending to seize the initiative in the stablecoin market. According to South Korean media "Seoul Economic Daily" report, Kakao Pay submitted 18 trademark applications related to the combinations of "KRW," "K," and "P" to the Korean Intellectual Property Office, such as "KRWKP," "KWRP," etc., covering virtual asset financial transactions, electronic transfers, and intermediary services, indicating its high expectations for the stablecoin business.

Kakao Pay will actively cooperate with the legislative process of the "Basic Law on Digital Assets" to seek to become one of the first compliant stablecoin issuers after the regulations are implemented. Kakao Pay will also leverage its traditional business advantages to closely collaborate with its parent company's ecosystem, including Kakao Bank and Kakao T, achieving deep integration of social, payment, and financial services, providing massive application scenarios for stablecoins.

Kaia is an EVM-compatible Layer 1 public chain formed by the merger of Klaytn (Kakao's subsidiary Ground X) and Finschia (LINE's subsidiary) in August 2024, aiming to connect a total of 250 million users of Kakao Talk and LINE. In early June 2025, KaiaChain Chairman Sam Seo clearly stated on social media that they would "fully promote the issuance of Korean won stablecoins" on the Kaia mainnet, claiming that "the summer of stablecoins has just begun." Earlier, Kaia had launched local USDT and collaborated with Tether to bring USD₮ into the Kaia ecosystem, laying the technical and ecological foundation for the subsequent KRW stablecoin.

Kaia plans stablecoin projects in collaboration with Kakao Pay, LINE NEXT, and other super apps, aiming to achieve integrated cross-chain and cross-platform circulation of "on-chain + social + payment." With the synergy of the underlying public chain and terminal payment ecosystem, once policies are released, its stablecoin project can be quickly launched to seize market opportunities.

Danal

Danal, a well-established payment service provider in South Korea, is also widely regarded as a promising participant. It launched PayCoin (PCI) in 2019, conducting early explorations in virtual asset payments. PayCoin once gained over 1 million registered users among various offline and online merchants, but due to unclear regulations at the time, the project was ultimately suspended due to obstacles in VASP (Virtual Asset Service Provider) registration.

With the South Korean government accelerating the legislative process of the "Basic Law on Digital Assets" and clearly supporting the policy direction of local currency-pegged stablecoins, Danal has restarted its digital currency business. According to a report by "MK" on June 2025, Danal has submitted multiple patent applications for "POS terminals supporting virtual asset payments and their operating methods" to the Korean Patent Office, aiming to provide underlying technical support for future possible stablecoin payment scenarios.

On the technical side, Danal has a natural advantage in the business processes of stablecoins due to its years of accumulated POS terminal network and payment clearing system. On one hand, its POS terminals can directly recognize and settle on-chain tokens, simplifying the user payment path; on the other hand, its backend system for merchant settlements can seamlessly connect with off-chain reserve management, providing prerequisites for compliance audits and reserve proof.

Nexus

On the same day that Kakao Pay officially entered the stablecoin sector, blockchain startup Nexus also expressed its desire to become the first issuer of the Korean won stablecoin.

According to a report by "ZDNet Korea" on June 2025, Nexus has issued a Korean won stablecoin named KRWx on the BNB Chain and has submitted a trademark registration application for it to the Korean Patent Office. Additionally, they have also submitted trademark applications for stablecoins pegged to other fiat currencies such as USD (USDx), JPY (JPYx), and EUR (EURx).

Nexus CEO Jang Hyun-guk stated that they chose to pre-release KRWx on the BNB Chain to establish a first-mover advantage and emphasized that they will continue to launch more fiat-pegged stablecoins, highlighting that "the reason for the existence of stablecoins lies in their practicality" and the opportunities they present in the global digital economy system. Nexus CEO Jang Hyun-guk

Additionally, gaming media "G‑Ennews" reported that Nexus is preparing for the issuance of "KRWx" and other fiat-pegged stablecoins and plans to establish a Hong Kong subsidiary, Nexus Stable HK, to leverage its advantages in Hong Kong law and trading markets to promote the internationalization of stablecoins.

Other Potential Participants

Samsung SDS, the IT solutions and system integration subsidiary of Samsung Group, has launched Nexledger, one of the most mature enterprise-level private chain solutions in the South Korean market, supporting multi-signature, cross-chain interoperability, and high-performance throughput. Industry insiders believe that Nexledger already possesses the three core characteristics required for stablecoins: "traceability + high reliability + auditability." Once internal or partner issuance plans are finalized, the technical preparations are almost ready.

According to a report by "Chosun English" on June 24, in the context of South Korea's upcoming policy to open local currency-pegged stablecoins, Samsung SDS has been listed as one of the possible "infrastructure providers," and its corporate clients may issue or host stablecoins through Nexledger.

Similarly, LG CNS, the IT solutions and system integration subsidiary of LG, is also seen as a potential participant and beneficiary due to its sufficiently developed underlying infrastructure. It has been selected as the official contractor for the Bank of Korea (BOK) wholesale CBDC/tokenized deposit system, undertaking the construction of an open blockchain platform, with a project budget of approximately 9.68 billion Korean won, covering the period from Q3 2024 to March 2025.

As a core supplier of wholesale CBDC and digital currency solutions, LG CNS possesses core capabilities in minting, clearing, auditing, and custody of on-chain asset management. With the advancement of the "Basic Law on Digital Assets," private institutions will gradually gain the qualification to issue stablecoins, and LG CNS can occupy the role of infrastructure supplier through technology output.