The initiative, quietly coordinated by the Open Blockchain & DID Association and overseen by the Financial Supervisory Service (FSS), aims to pilot issuance by early 2026
The participating banks, KB Kookmin, Shinhan, Woori, NH Nonghyup, Industrial Bank of Korea, Suhyup, Citibank Korea, and Standard Chartered First Bank, account for a large percentage of national retail deposits.
Their unprecedented collaboration follows a surge in foreign stablecoin use that saw dollar-pegged coins like USDT and USDC reach ₩56.95 trillion ($41.6 billion) in trade volume during Q1 2025, tripling since Q3 2024.
“There is a shared sense of crisis that if things continue this way, foreign dollar coins could dominate the domestic market,” a banking source told Cryptonews.
Analysts interpret the BOK’s positioning as a strategic preference to allow highly regulated incumbents to establish the groundwork for digital currency issuance before opening the gates to fintech firms or international players.
Korea is now playing catch-up with Japan and the EU, following Japan’s launch of Progmat Coin by its top banks and the European Central Bank’s MiCA framework, which opens doors to euro-pegged stablecoins.
While some observers frame Korea’s move as defensive, others see it as a proactive shift that could eventually position a won-backed coin as a regional clearing asset, especially in industries like gaming, K-pop merchandising, and cross-border remittances.
The Terra crisis, which caused billions in investor losses and originated in Korea, cast a long shadow over stablecoin innovation in the country. But the banks’ fully backed model, with transparency mechanisms expected to be enshrined in the upcoming Digital Asset Act, aims to rebuild public trust.
Final regulatory approval will depend on the FSS’s risk assessments and ongoing consultation with the Bank of Korea.
The won-backed coin could initially be integrated into digital banking apps and payment systems, targeting use cases such as remittances, peer-to-peer transfers, and interbank settlements. If successful, the model may inform South Korea’s long-term CBDC roadmap.
