Competition in the South Korean stablecoin market intensifies: multiple forces vying for the lead

South Korean President Lee Jae-myung proposed an innovative initiative to support "local currency-linked stablecoins" before taking office, aiming to curb wealth outflow and enhance the competitiveness of the country's digital financial ecosystem. Subsequently, the South Korean cryptocurrency industry quickly took action: eight major commercial banks are preparing a joint project for a Korean won stablecoin, while traditional tech giants and Web3 companies are also making moves, striving to gain an edge in the regional and even global stablecoin competition.

At the same time, Congress is reviewing the "Basic Law on Digital Assets" to provide a legal basis for private institutions to issue Korean won stablecoins, and financial regulatory authorities are also accelerating the establishment of operational standards in line with international practices. The second half of 2025 to the first half of 2026 may become a window period for the "explosive" growth of the Korean stablecoin market.

Korea Banking Alliance

The Bank of Korea has maintained a cautious attitude towards whether stablecoins can serve as substitutes for legal tender. The central bank governor, Lee Chang-yong, stated that they are working with relevant institutions to develop a regulatory framework for stablecoins to ensure their stability and practicality while preventing them from being used to evade foreign exchange controls.

Under this cautious policy orientation, banking institutions have become the most competitive participants in the Korean won stablecoin race. It has been reported that eight major banks in South Korea plan to prepare for the establishment of a joint venture to issue a Korean won stablecoin, with participating banks including Kookmin Bank, Shinhan Bank, Woori Bank, Nonghyup Bank, Korea Development Bank, Suhyup Bank, Citibank Korea, and Standard Chartered Bank Korea. The Open Blockchain and Decentralized Identifiers Association (OBDIA) and the Korea Financial Telecommunications and Clearing Institute (KFTC) will participate in coordination and cooperation.

The project team is considering two issuance models for stablecoins: one is the trust model, where customer funds are separately trusted before issuing stablecoins; the other is the deposit token model, which links stablecoins to bank deposits. A joint venture could be established as early as the end of this year or the beginning of next year.

Kookmin Bank ( is the most actively involved institution in the layout of stablecoins and has initiated the process of acquiring relevant trademark rights. Shinhan Bank ) previously collaborated with Hedera on a pilot for a Korean won stablecoin and participated in the cross-border remittance demonstration experiment "Project Pax" based on stablecoins. Woori Bank, NH Nonghyup Bank, and others play important roles in CBDC testing, interbank RTGS, and blockchain projects; corporate banking has been deeply involved in SME credit and trade financing for many years; Standard Chartered and Citibank's Korean branches can provide overseas clearing and offshore liquidity support for stablecoins.

Kakao Pay and Kaia

Kakao Pay, as a leading company in the Korean payment sector, is one of the most proactive players among large firms in the layout of the Korean won stablecoin. Established in 2014, Kakao Pay quickly became a leading enterprise in the South Korean mobile payment market, relying on the Kakao Talk instant messaging application.

On June 22, Kakao Pay officially launched its business layout for KRW stablecoin, submitting 18 trademark applications related to the combination of "KRW", "K", and "P" to the Korean Intellectual Property Office, covering the fields of virtual asset financial transactions, electronic transfers, and intermediary services. Kakao Pay will actively cooperate with the legislative process of the "Digital Assets Basic Law" to seek to become one of the first compliant stablecoin issuers after the regulations are implemented.

Kaia is an EVM-compatible Layer 1 public chain formed by the merger of Klaytn and Finschia in August 2024. Sam Seo, the chairman of KaiaChain, stated that they will "fully promote the issuance of the Korean won stablecoin" on the Kaia mainnet. Kaia has launched local USDT and partnered with Tether to introduce USD₮, laying the technical and ecological foundation for the subsequent KRW stablecoin.

Kaia is collaborating with super applications like Kakao Pay and LINE NEXT to plan a stablecoin project, aiming to achieve an integrated cross-chain and cross-platform circulation of "on-chain + social + payment". With the ecological synergy of the underlying public chain and terminal payment, once the policy is released, its stablecoin project can be launched quickly, seizing market opportunities.

Danal

The well-established payment service provider Danal launched PayCoin(PCI) in 2019, conducting early explorations in the virtual asset payment field. As the South Korean government accelerates the legislative process for the "Digital Asset Basic Law", Danal has once again initiated its digital currency business. According to reports, Danal submitted multiple patent applications to the Korean Patent Office in June 2025 for "POS terminals supporting virtual asset payments and their operational methods."

On a technical level, Danal has a natural advantage in the business process of stablecoins thanks to its years of accumulated POS terminal network and payment clearing system. Its POS terminals can directly identify and settle on-chain tokens, simplifying the user payment path; the backend system can seamlessly connect to off-chain reserve management, providing prerequisites for compliance audits and reserve proof.

Nexus

The blockchain startup Nexus has expressed its desire to become the first issuer of a Korean won stablecoin. Nexus has issued a Korean won stablecoin named KRWx on the BNB Chain and has submitted a trademark registration application to the Korean Patent Office. In addition, they have also submitted trademark applications for fiat stablecoins such as USD(x), JPY(x), and EUR(x).

Nexus CEO Jang Hyun guk stated that they chose to pre-release KRWx on the BNB Chain in order to establish a first-mover advantage and will continue to launch more fiat-backed stablecoins. Nexus is preparing for the issuance of "KRWx" and other fiat stablecoins and plans to establish a Hong Kong subsidiary, Nexus Stable HK, to promote the internationalization of stablecoins.

Other Potential Participants

Nexledger, launched by Samsung SDS, is one of the most mature enterprise-level private blockchain solutions in the South Korean market, supporting multi-party signatures, cross-chain interoperability, and high-performance throughput. Industry insiders believe that Nexledger has the core features required for stablecoins, and once the internal or partner issuance plan is finalized, the technological preparations are almost ready.

LG CNS, as the official contractor for the wholesale CBDC/tokenized deposit system of the Bank of Korea, has mastered the core capabilities of on-chain asset management such as minting, clearing, auditing, and custody. With the advancement of the "Digital Asset Basic Act," LG CNS can occupy the role of an infrastructure provider through technology output.