KakaoBank, South Korea’s digital banking giant, recently announced its strategic plans to enter the cryptocurrency market in the first half of 2025. This move involves launching a stablecoin based on the South Korean won, leveraging its existing expertise in KYC (Know Your Customer) and AML (Anti-Money Laundering) tracking through real-name verified accounts. According to ZDNet, this initiative aligns with South Korea’s evolving regulatory framework.
KakaoBank’s Stablecoin Initiative
During the financial results announcement for the first half of 2025, KakaoBank’s CFO, Kwon Tae-hoon, underscored the bank’s exploration of cryptocurrency issuance and custody options. The company is preparing to introduce a won-based stablecoin, utilizing its three-year history of real-name verified account systems to establish secure infrastructures for cryptocurrency transactions. Concurrently, the Kakao Group Crypto Task Force continues its efforts. Kwon highlighted that maintaining stability and technological competence are critical in this domain.
In addition, KakaoBank has participated in the Bank of Korea’s central bank digital currency (CBDC) trials, where digital wallet creation, remittance, and transfer tests were conducted. This initiative enhanced both regulatory collaborations and operational infrastructures.
Regulatory Framework for Won-Based Stablecoins in South Korea
The newly elected President, Lee Jae Myung, previously declared his intention to promote a cryptocurrency market based on the local currency, won, to prevent capital flight. This regulatory plan was solidified through a fundamental bill proposed by a ruling party Member of Parliament, as promised during the election campaign.
The proposed bill aims to provide a clear legal framework for won-based stablecoin issuers and intermediaries. Once finalized, banks and fintech companies will be capable of directly bringing various won-based products to the market, enhancing their offerings.
The private sector is also witnessing increased activity. KakaoPay filed trademark applications for cryptocurrency symbols in June, indicating an impending intensification of competition among South Korea’s prominent payment service providers as they gear up for this significant marketplace shift.
