The Bank of Korea has teamed up with eight industry peers to establish a stablecoin joint venture, while the central bank hits the brakes: prioritizing caution.

Under the policy guidance vigorously promoted by South Korean President Lee Jae-myung, the Korean won stablecoin is gradually coming to light, with eight major banks, including KB Kookmin Bank, applying for stablecoin trademarks and forming alliances to prepare to enter the crypto market. However, the Bank of Korea is relatively conservative, concerned about capital outflows and financial stability issues, and is actively advancing CBDC as a balancing tool.

The National Bank of Korea submits stablecoin trademarks and joins forces with eight major banks to form an alliance.

South Korea's largest commercial bank, KB Kookmin Bank, recently submitted 17 trademark applications related to stablecoins, including token codes such as "KBKRW, KRWKB, and KBST", covering virtual currency trading software and blockchain applications.

According to KB, in an interview with local media Aju Economic News, this is a "proactive deployment" for the upcoming stablecoin alliance. The alliance members include seven major banks such as Shinhan, Woori, Nonghyup, IBK, KEB Hana, Citibank Korea, and Standard Chartered Korea, among which four are the top four banks by market share in South Korea.

Another local media, Econovill, pointed out that the eight major banks are preparing to establish a joint venture to issue a stablecoin based on the Korean won:

The alliance is collaborating with the South Korean blockchain initiative organization OBDIA and the payment clearing institution KFTC, with plans to officially launch by the end of 2025 or early 2026.

This move echoes the simultaneous application of KakaoPay, indicating that a competition for the Korean won stablecoin has quietly begun.

(South Korean messaging software Kakao registers stablecoin trademark! Korean stocks Kakao rise over 30%, can Kaia ride the stablecoin wave? )

Central Bank pours cold water: stablecoins must be prudently promoted by banks

In contrast to the proactive attitude of the banking industry, the Deputy Governor of the Bank of Korea (BOK), Ryoo Sangdai (, stated at a press conference today:

Stablecoins should be issued first by the most strictly regulated banks and gradually expanded to other institutions. At the same time, a safety net needs to be established to prevent market turmoil and consumer harm.

Central Bank Governor Lee Chang-yong also added that although he does not oppose the concept of the Korean won stablecoin, he still holds reservations regarding the foreign exchange management and cross-border capital flows involved.

Liu Xiangdai also expressed doubts about the necessity of issuing the Korean won stablecoin, and is concerned that a rapid implementation may lead to capital outflows, affect foreign exchange policies, and put pressure on the adjustment of the local financial system.

What non-USD stablecoins are currently being widely used? The existence of USD stablecoins and their preference as a safe-haven asset by various countries does not in itself constitute a reason to issue a Korean won stablecoin.

Last week, the South Korean government just introduced the draft of the "Digital Asset Basic Act," allowing companies with capital exceeding 500 million won ), approximately 368,000 USD(, to issue stablecoins with a license.

)South Korea promotes the "Basic Law on Digital Assets": stablecoin issuance requires licensing, plans to establish a regulatory committee directly under the President(

Compared to stablecoins, do Central Banks prefer CBDC?

In the face of the rise of private stablecoins, the Bank of Korea seems inclined to be more interested in Central Bank Digital Currency )CBDC(. Currently, the BOK is participating in Project Agora, led by the Bank for International Settlements )BIS(, while promoting a domestic testing program called "Project Hangang", which is expected to conclude by the end of June.

BOK stated that whether the next phase of testing will be initiated depends on the progress of legislation related to stablecoins, and it will be coordinated with major banks for execution. Central Bank officials also revealed that they will seek to expand regulatory powers over non-bank institutions in the upcoming Presidential Policy Planning Committee to respond to changes in the financial industry.

The battle for stablecoins in South Korea has just begun.

As private financial institutions work together to promote the development of stablecoins, South Korea continues to accelerate in the Asian digital currency competition. However, the Central Bank's cautious stance and potential regulatory obstacles add variables to this transformation. Whether South Korea can successfully create a local stablecoin ecosystem remains to be seen, as it depends on the actual progress of policy coordination and technological implementation.

This article reports that the Bank of Korea, in collaboration with eight other institutions, has established a stablecoin joint venture, while the Central Bank applies the brakes: prioritizing caution. It first appeared in Chain News ABMedia.