BNK Busan Bank Beats Regulators to Won Stablecoin Pioneering

Banks in South Korea are racing to develop won-backed stablecoins before regulations are established. BNK Busan Bank, along with AhnLab Blockchain Company, successfully completed a proof of concept for a won-backed stablecoin payment and settlement system using the Kaia blockchain.

The trial tested issuance, circulation, charging, payment, and settlement, showing that programmable digital money with restrictions on use can exist. The project also validated charging, payment, and settlement capabilities, as well as testing different settlement approaches based on where payment was made.

This pilot comes at a time of intense competition among South Korean financial groups to be first to market with this innovation. Kaia is an EVM-compatible layer-1 chain that's well-positioned for these projects. The partners aim to expand the model into policy funds, digital vouchers, and possible central bank digital currencies.