KakaoBank Breaks Through Regulatory Barriers to Introduce Stablecoin as South Korea Accelerates Digital Finance Competition

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Bitget-RWA2025/11/26 11:14

By:Bitget-RWA

- KakaoBank accelerates development of "Kakao Coin," a Korean won-pegged stablecoin, to lead South Korea's blockchain-driven financial innovation. - Founder Kim Beom-soo leads the project, hiring blockchain experts for infrastructure while navigating regulatory debates over bank ownership requirements. - Naver-Dunamu's $10.3B merger creates a crypto-payment giant, intensifying competition as firms race to secure stablecoin market dominance amid unclear regulations. - Regulatory gridlock between Bank of Kor

KakaoBank, recognized as South Korea’s top digital bank, is ramping up efforts to launch a stablecoin tied to the Korean won, known as "Kakao Coin," as part of its broader strategy to embed blockchain into its financial offerings. After securing necessary internal and regulatory green lights, the company is making a decisive move to lead the nation’s emerging stablecoin sector. The project is reportedly being led by Kakao’s founder, Kim Beom-soo,

utilizing the company’s extensive user network

spanning messaging, banking, and payment services to encourage widespread use. The bank has also started

recruiting blockchain professionals

, such as backend engineers skilled in smart contracts, to create the technical foundation for stablecoin issuance and security token offerings (STOs).

This initiative coincides with South Korea’s increasing focus on digital assets,

with stablecoins making up 30%

of all global on-chain crypto transactions in 2025. Nonetheless, regulatory uncertainty remains a significant obstacle. The Bank of Korea (BOK) has recommended that banks maintain majority ownership in stablecoin issuers to reduce systemic risks, while technology companies and the Financial Services Commission (FSC) advocate for greater involvement from non-bank players. This regulatory impasse has

postponed the rollout

of a stablecoin regulatory framework, which was initially slated for late 2025. Despite the lack of clarity, KakaoBank is moving forward, highlighting the urgency among firms to gain an early advantage in the sector.

KakaoBank Breaks Through Regulatory Barriers to Introduce Stablecoin as South Korea Accelerates Digital Finance Competition image 0

The competitive landscape has intensified following the Naver-Dunamu merger, completed in November 2025. Naver Financial’s takeover of Dunamu, which operates Upbit—the country’s largest crypto exchange—has formed a powerful entity with robust payment systems and regulatory know-how. The $10.3 billion all-stock transaction, which lowers Naver’s stake to 17%, is projected to

support swift introduction

of stablecoin products across Naver’s ecosystem. Market observers believe this merger could become a model for stablecoin issuance and distribution in South Korea,

especially as the new group considers

a potential listing in the United States.

KakaoBank’s approach also involves exploring STOs, working with Korea Investment & Securities and Lucent Block to create blockchain-driven financial solutions. These initiatives are in step with recent legislative changes in South Korea,

designed to launch

an STO market by mid-2026, which could reach a value of $287 billion by 2030. At the same time, Naver-Dunamu’s entry into stablecoins highlights the merging of traditional finance and digital assets,

as the combined company plans

to use its 80 trillion won in yearly payment transactions to enable instant stablecoin settlements.

Regulatory certainty remains the main barrier. Although lawmakers have put forward several stablecoin proposals, disagreements continue over ownership models, reserve policies, and interest distribution. The BOK’s demand for banks to hold at least 51% ownership in issuers stands in contrast to the FSC’s more inclusive stance,

resulting in a fragmented regulatory landscape

. KakaoBank’s push into this space, despite ongoing ambiguities, reflects a wider shift among financial institutions to prioritize innovation, even ahead of regulatory finalization—a move that could influence the direction of South Korea’s digital economy in the near future.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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