The South Korean stablecoin market is entering a period of explosive growth, with multiple parties competing for first-mover advantage.

After taking office, South Korean President Lee Jae-myung has seen a rapid warming of the Korean won stablecoin market. Currently, banking alliances, tech giants, and Web3 companies are all making moves to gain an edge in the regional and even global stablecoin competition. Meanwhile, the National Assembly is reviewing relevant bills to provide a legal basis for private institutions to issue Korean won stablecoins, and regulatory bodies are also accelerating the establishment of norms. It is expected that the second half of 2025 to the first half of 2026 will be the explosion period of the South Korean stablecoin market.

Bank Alliance Seizes Opportunity

The Bank of Korea has a cautious attitude towards stablecoins, believing that they may impact monetary policy and the transaction settlement system. Deputy Governor Yoo Sang-dae stated that the Korean won stablecoin should first be issued by strictly regulated commercial banks, and after accumulating experience, it can then be expanded to the non-bank sector.

Recently, eight major banks in South Korea plan to establish a joint venture to issue a Korean won stablecoin. The participating banks include KB Kookmin Bank, Shinhan Bank, and Woori Bank, among others. The project team is considering two issuance methods: a trust model and a deposit token model. The joint venture may be established as early as the end of this year or early next year.

As the largest retail bank in South Korea, National Bank has initiated the trademark application process related to stablecoins. Shinhan Bank had already collaborated with Hedera in 2021 to pilot a Korean won stablecoin. Other participating banks, such as Woori Bank and NongHyup Bank, have also accumulated rich experience in CBDC testing and blockchain projects.

Tech Giants Invest in Stablecoins

Kakao Pay, as a leading enterprise in the payment sector of South Korea, has been active in the layout of stablecoins. The company has submitted 18 trademark applications related to stablecoins to the Korean Intellectual Property Office, covering areas such as virtual asset trading and electronic transfers. Kakao Pay will leverage its advantages in social, payment, and financial services to provide a wide range of application scenarios for stablecoins.

The Kaia public chain is formed by the merger of Klaytn and Finschia, and plans to promote the Korean won stablecoin on the mainnet. Kaia collaborates with super apps such as Kakao Pay and LINE NEXT, aiming to achieve integrated cross-chain and cross-platform circulation of "on-chain + social + payment."

The veteran payment service provider Danal has also restarted its digital currency business and has submitted multiple patent applications for POS terminals that support virtual asset payments. Danal has a mature POS terminal network and payment clearing system, giving it an advantage in the stablecoin business process.

Web3 Enterprises Actively Participate

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

Samsung SDS's Nexledger and LG CNS's CBDC solutions are also seen as potential stablecoin infrastructure providers. These enterprise-level blockchain platforms have the core characteristics required for stablecoins and can provide technical support for other institutions.

With the advancement of the "Basic Law on Digital Assets," competition in the South Korean stablecoin market will become increasingly fierce. Various participants are actively positioning themselves to prepare for the future market explosion.