Financial Institutions Form Alliances to Lead Stablecoin Market
With South Korea planning to finalize stablecoin regulations by next month, major local financial institutions are speeding up their strategies to issue won-backed stablecoins. The ruling Democratic Party is seeking to overturn the token issuance ban in place since 2019, allowing domestic firms to issue stablecoins pegged to the Korean won.
Hana Financial Group recently initiated a stablecoin consortium, joined by BNK Financial Group, iM Financial Group, Standard Chartered Bank Korea, OK Savings Bank, with JB Financial Group joining soon after. The group has agreed to form a dedicated company to issue won-backed stablecoins once the ban is lifted and has started exploring collaborations with companies in the travel and insurance sectors.
Technology Giants Also Pushing Forward
Meanwhile, Kakao is forming a stablecoin working group through its banking and digital payment subsidiaries and has already started developing a won-backed stablecoin under its own brand. Regulators have proposed a compromise, considering allowing only consortia led by large banks to issue stablecoins, prompting financial institutions to form alliances in anticipation of the regulatory framework.
- Consortium accelerates plans for a dedicated stablecoin company
- Exploring cross-industry collaboration with travel and insurance firms
- Regulators suggest limiting issuance to major bank-led groups