South Korean tech giant Kakao plans to launch its own stablecoin backed by the Korean won (KRW) on the Kaia blockchain (native token $KAIA ) — a new platform that emerged from the merger of Klaytn and Finschia. In August, Kaia registered four trademarks related to the national currency: KRWGlobal, KRWGL, KRWKaia, and KaKRW.
The project's goal is to create a bridge between stablecoins pegged to other fiat currencies, such as the US dollar or the Japanese yen, and to provide access to DeFi services directly through Kakao mobile apps, which are used by over 49 million people every month.
According to the head of the Kaia DLT Foundation, this will allow users to easily interact with decentralized finance without the need for separate platforms or wallets.
However, the launch depends on regulatory decisions. Discussions on stablecoin bills are still ongoing in South Korea. The ruling and opposition parties have submitted different versions that diverge on the issue of interest accrual on deposits, although both support full reserve backing and granting regulators emergency powers.
The main issue is the limited use of Korean stablecoins compared to dollar-pegged ones. And although Kakao covers over 95% of the country's population, the launch of the token will only be possible after clear rules are defined regarding licensing, reserves, capital, and the role of banks.
The Bank of Korea proposes that the issuance of stablecoins be carried out by banks and is exploring the possibility of creating deposit tokens on public blockchains.
