South Korea’s leading payment company, NHN KCP, has launched an extensive pilot project to use stablecoins for payments via a private network built on the Avalanche (AVAX) blockchain. This pilot, which began on May 21, enables both online and physical store payments. During the trial, company employees are paying for daily needs like cafeteria and restaurant orders with stablecoins, and all transactions are reportedly completed within seconds.
NHN KCP’s blockchain payment pilot
As a technology leader in South Korea’s e-commerce, finance, and payments sector, NHN KCP processes one of the largest transaction volumes in the country. Collaborating with Ava Labs, the company has built a dedicated Avalanche Layer 1 blockchain infrastructure to underpin its payment systems. Last year, NHN KCP reported a total transaction volume of 51.5 trillion Korean won, equivalent to about $38 billion.
Roughly 700 employees are participating in the pilot, making daily payments with stablecoins by simply scanning a QR code. Each transaction is finalized in no more than two seconds. The test is also integrated with PAYCO, one of South Korea’s most popular payment apps, allowing PAYCO users to buy or redeem gift certificates through stablecoins.
To simplify blockchain adoption for businesses, NHN KCP has developed a dashboard offering real-time transaction and payment tracking that requires no specialized knowledge. All settlement operations are carried out automatically via smart contracts, ensuring seamless and secure reconciliation.
According to NHN KCP’s representatives in comments to local media, the company aims to develop a next-generation solution that unifies all payment services and merges online and offline processes under a single structure.
Glossary: Avalanche is a blockchain platform designed for decentralized applications and scalable financial solutions. Layer 1 refers to a main blockchain network with its own consensus mechanism.
Adoption of AVAX in Asian payment systems
The Avalanche network is increasingly becoming the infrastructure of choice for major financial players not just in South Korea but throughout Asia. In Japan, TIS—which handles half of the country’s credit card transactions—has established a platform on Avalanche for issuing stablecoins and security tokens. Progmat, which manages $2 billion in real-world asset tokens, plans to fully migrate to Avalanche by June 2026. Meanwhile, SMBC Bank is testing global stablecoin transfers with 24/7 settlement through the same network.
Similarly in Singapore, StraitsX leverages Avalanche Layer 1 to manage payments for its regulated stablecoins XSGD and XUSD. This enables apps like Grab and Alipay+ to provide stablecoin-based payment options across Southeast Asia—without exposing end users directly to blockchain technology.
In Thailand, KBank subsidiary Orbix Technology has developed instant cross-border QR code payments with real-time currency conversion between Thailand and Singapore. Back in South Korea, KB Kookmin Card is building a hybrid system that combines stablecoin and conventional credit payments within digital wallets linked to its existing credit cards.
Regulation and future outlook
The groundwork for widespread stablecoin adoption in South Korea hinges on the country’s pending Digital Asset Basic Act, which remains in draft form. Once enacted, it would clarify licensing for stablecoin issuers, outline rules for issuance and distribution, and formally define digital assets’ legal status.
However, debate over the legislation has been postponed until after local elections scheduled for June 3. The South Korean Financial Services Commission has already announced it will gradually introduce stricter controls on stablecoin issuers.
NHN KCP has filed for multiple trademarks linked to stablecoin products, including ones pegged to the Korean won (KRW) and the US dollar (USD), such as the USDW brand. The company’s strategy is to integrate these stablecoins into both domestic and cross-border payment infrastructures once regulations are clarified. Ava Labs’ Asia head, Justin Kim, noted that finalizing regulatory definitions and authorizations for stablecoins will be vital for fully launching Layer 1 networks.
NHN KCP ultimately plans to scale beyond the pilot, expanding its system to include banks, merchants, and other payment service providers. However, an official date for commercial launch has not yet been set.
