South Korean cryptocurrency custody service provider BDACS announced the launch of the country’s first won-backed stablecoin, KRW1, on the Avalanche network. The coin is secured with won assets held at Woori Bank at a 1:1 ratio. Although still in the testing phase, KRW1 has been developed in alignment with the existing legal framework.
Technical Foundation of KRW1
BDACS revealed that it successfully completed a comprehensive feasibility study demonstrating the technical viability of KRW1. The Avalanche network was chosen for its reliability and security, which is preferred for public applications. Each KRW1 coin is fully backed by won assets held at Woori Bank.
A real-time API integration with Woori Bank ensures transparent verification of reserves. In addition to coin issuance, the company has established an infrastructure covering issuance and management systems. A mobile application was developed as part of the system, enabling users to conduct peer-to-peer (P2P) transfers and verify transactions.
BDACS has identified cross-border money transfers, payments, investments, and deposits as key application areas for KRW1. Additionally, the stablecoin could be used for emergency aid payment exchanges in the public sector. The company plans to expand KRW1 to other Blockchain networks besides Avalanche and intends to collaborate with global stablecoin projects like USDT or USDC.
Stablecoin Regulations in South Korea
Currently, KRW1 is at the proof-of-concept (PoC) stage and is not in circulation, therefore not violating existing legal frameworks. Although no specific regulations for stablecoins have been implemented in South Korea, discussions are ongoing.
President Lee Jae Myung supports the development of a stablecoin market linked to the local currency. However, the country’s central bank argues that stablecoin issuance should be limited to licensed banks to preserve financial stability.
BDACS, backed by strong corporate partnerships, is poised to take a leading role in this process. The company aims to secure a favorable position in the local stablecoin market with support from Woori Bank. It views potential entries by major tech companies as cooperation opportunities rather than competition.
With positive news flow like the KRW1 development, the Avalanche network’s main asset, AVAX, experienced a recent upward movement. As of the time of reporting, AVAX saw a 7.82% rise in the last 24 hours, trading at $32.50. CryptoAppsy data indicates that the altcoin‘s price rose by 13.22% in the last week and over 40% in the past 30 days.
