South Korea's stablecoin market is poised for growth: Multiple parties compete to lead a new era of digital finance

After taking office, South Korean President Lee Jae-myung's policy direction supporting the domestic currency pegged stablecoin gradually became clear, aiming to enhance the competitiveness of the country's digital financial ecosystem. With favorable policies, the South Korean cryptocurrency industry began to actively layout: not only are major commercial banks preparing joint projects, but traditional tech giants and Web3 companies are also entering the field, striving to seize the initiative in the regional and even global stablecoin competition.

Meanwhile, Congress is reviewing related bills to provide a legal basis for private institutions to issue Korean won stablecoins, and regulatory authorities are also accelerating the establishment of regulations. It is expected that the second half of 2025 to the first half of 2026 will be a critical period for the rapid growth of the South Korean stablecoin market. This article systematically organizes and deeply analyzes the main participants, business models, and innovative trends in the South Korean stablecoin market.

Korea Bank Alliance

Although the Bank of Korea takes a cautious attitude towards stablecoins, it believes that it is more appropriate for strictly regulated commercial banks to issue them first. According to reports, eight major banks plan to prepare to establish a joint venture to issue a Korean won stablecoin, with participating banks including KB Kookmin Bank, Shinhan Bank, and Woori Bank. The project team is considering two issuance schemes: a trust model and a deposit token model, with a joint venture possibly being established as early as the end of this year or the beginning of next year.

Among them, the National Bank has been the most proactive and has initiated the relevant trademark application process. Shinhan Bank partnered with Hedera as early as 2021 for a pilot of a Korean won stablecoin. Woori Bank, NH Nonghyup Bank, and others are experienced in CBDC testing and interbank payment systems, while corporate banks have clear advantages in serving small and medium-sized enterprises. Standard Chartered and Citibank's Korean branches can rely on their parent banks' international networks for support.

Kakao Pay and Kaia

Kakao Pay, as a leading enterprise in the South Korean payment sector, has acted swiftly in the layout of stablecoins. On June 22, Kakao Pay officially launched its business layout for the Korean won stablecoin, submitting 18 related trademark applications to the Korean Intellectual Property Office. Kakao Pay will actively cooperate with regulatory formulation in order to become one of the first compliant stablecoin issuers. With its advantages in social, payment, and financial services, Kakao Pay is expected to provide a vast array of application scenarios for stablecoins.

Kaia is a public chain formed by the merger of Klaytn and Finschia, aimed at connecting a total of 250 million users from Kakao Talk and LINE. The chairman of Kaia stated that it will "fully promote the issuance of the Korean won stablecoin" on the mainnet. Kaia has launched local USDT, laying the foundation for the subsequent KRW stablecoin. Kaia collaborates with super applications like Kakao Pay, striving to achieve integrated cross-chain and cross-platform circulation of "on-chain + social + payment".

Danal

The well-established payment service provider Danal launched PayCoin in 2019 to explore virtual asset payments. With the improvement of the policy environment, Danal has restarted its digital currency business and has submitted multiple patent applications related to POS terminals that support virtual asset payments. With years of accumulated POS terminal networks and payment clearing systems, Danal has a natural advantage in the stablecoin business process.

Nexus

The blockchain startup Nexus has issued a Korean won stablecoin named KRWx on the BNB Chain and has submitted a relevant trademark registration application. Nexus CEO emphasized the practicality of the stablecoin and its opportunities in the globalization of the digital economy. Nexus also plans to establish a subsidiary in Hong Kong to promote the internationalization of the stablecoin.

Other Potential Participants

Samsung SDS's Nexledger and LG CNS's CBDC system solutions have the core technological characteristics required for stablecoins. As underlying infrastructure providers, they are expected to play an important role in the stablecoin ecosystem. As regulations gradually improve, these tech giants may gain a competitive edge in the stablecoin infrastructure sector through technology exports.