South Korea is witnessing a race among major financial holding companies to launch stablecoin projects, through partnerships with major tech companies such as Naver, Kakao, and Samsung Electronics, according to a report published by the Korea Times.
The report stated that KB Financial Group, Shinhan Financial Group, Hana Financial Group, and Woori Financial Group have started to build the technical infrastructure for issuing stablecoins or facilitating transactions, benefiting from the platforms of technology companies that have robust systems ready for immediate application.
Although stablecoins have not been officially recognized as a payment system, the volume of their domestic transactions has exceeded 41.15 billion USD, reflecting an increasing reliance in the financial sector.
The discussions surrounding the issuance of stablecoins linked to the Korean won focus on banks as the main issuers, with fintech companies continuing as only technical partners. Partnerships with Naver, Upbit, and Samsung Wallet have seen rapid expansion, while BDACS successfully launched the stablecoin KRW1 in collaboration with Woori Bank in a proof of concept trial.
Regulatory bodies in South Korea are preparing to present a bill that regulates the issuance of stablecoins to the National Assembly by the end of the year, to provide the first unified framework for how issuance and management should occur, prohibiting the granting of yields to holders, in line with similar rules in the United States.
The current race in South Korea to launch stablecoins indicates a radical shift in the financial sector, where traditional banks combine modern technology and digital infrastructure to facilitate transactions. The anticipated regulatory project also indicates the country's readiness to provide a clear legal environment, enhancing investor confidence and stimulating the local growth of stablecoins, placing South Korea at the forefront of countries embracing digital financial innovation.
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