Breaking: 8 Major South Korean Banks Unite to Launch KRW-Backed Stablecoin with Dual-Model Strategy

South Korea's banking giants are making a coordinated crypto push—and they're bringing the won with them.

The Stablecoin Playbook

Eight domestic banks just formed a consortium to develop not one, but two distinct KRW-pegged stablecoin models. No more waiting for regulators to act—these institutions are building the rails for programmable won.

Why It Matters

While Wall Street debates tokenization, Seoul's banks are executing. The dual-model approach suggests they're hedging bets—one likely for interbank settlements, another for retail DeFi integration. Because nothing says 'financial innovation' like covering all regulatory bases.

The Bottom Line

Watch for this to accelerate Korea's crypto dominance in Asia. And let's be honest—after years of banks complaining about stablecoins 'disrupting monetary policy,' nothing inspires innovation like the fear of becoming irrelevant.

Banks Rollout Two Initial Won-Linked Stablecoin Models

Per the local report, discussions on joint infrastructure between banks are currently in progress. Further, the establishment of the cooperation WOULD come to light this year or early next year.

The banks have rolled out an initial plan comprising two methods of issuing the won-backed stablecoin – trust-based and deposit-linked.

In the trust model, coins are issued after separately entrusting customer funds, while in the deposit-linked model, coins are issued by linking 1:1 with bank deposits.

“There is a shared sense of crisis that if things continue this way, foreign dollar coins could dominate the domestic market,” a banking official noted. “It is time to secure both the independence and competitiveness of the domestic financial system through a won-based digital currency.”

Stablecoin Regulations and President’s Promises

The current trend of banks’ involvement is in line with the Digital Asset Act that was recently proposed by South Korea’s National Assembly. The legislation explicitly notes the introduction of a stablecoin authorization system.

However, the Bank of Korea is still skeptical of proposals to launch a won stablecoin. Meanwhile, the newly elected President Lee Jae-myung has pledged to launch a KRW-pegged coin for use in business and international trade.

Presidential candidate Lee Jae-myung proposes a won-backed stablecoin to stop $40.8B in crypto capital flight.#Korea #Stablecoin #LeeJaemyunghttps://t.co/qR1jwd7tXB

His administration is quickly moving to implement campaign pledges aimed at modernizing South Korea’s regulatory framework for digital assets.

The joint venture of banks is a private sector-led model, differing from the CBDC being prepared by the Bank of Korea. Though further discussions on its technological linkages with the central bank are needed, there are talks in the market that it can be expanded into various applications such as cross-border remittance and domestic payments.