South Korea's regulators plan to allow companies to autonomously issue Korean won stablecoins, and all five major banks are gearing up.

According to a report by South Korea's News Watch, local financial regulators are considering allowing technology companies, fintech startups, and other non-bank entities to issue Korean won stablecoins. However, the five major banks have quietly initiated cross-border remittance tests and laid out infrastructure and custody business plans. Now, with the government's optimistic stance towards corporate integration, the vision of a blooming Korean won stablecoin is gradually taking shape.

Policy Acceleration: South Korea's FSC is said to open up the issuance of KRW stablecoins by enterprises.

The South Korean Financial Services Commission (FSC) has reported that it is seriously considering a proposal to allow non-financial industry companies to issue Korean won stablecoins. This would break the ban on stablecoin issuance that has been in place since 2019 and also symbolize the first significant relaxation of related policies by the South Korean government.

President Lee Jae-myung promised during his campaign to fully open the domestic stablecoin market, and now the consistent attitude of the FSC also hopes to be a driving force for the implementation of the policy.

(South Korea plans to amend laws to regulate stablecoins! Regulation will be conducted in accordance with foreign exchange transactions)

Tech giants joining the fray? Concerns grow over widening gaps.

Once the proposal is passed, fierce competition is expected to emerge in the South Korean stablecoin market. Industry insiders admit that technology companies excel in user experience and digital products, and if they enter the blockchain payment and stablecoin ecosystem, the competitiveness of traditional banks may be weakened.

However, the banking sector still adopts a low-profile stance externally, believing that discussions are still in the early stages, making it difficult to assess the impact. A senior banking executive stated that a successfully launched KRW stablecoin needs to combine innovation and stability, while financial institutions will still play a key role in asset protection and payment settlement.

In other words, even if companies can issue coins, banks still believe they hold irreplaceable, fundamental, and compliant financial services.

( Korean won stablecoin is not far off? South Korean authorities will submit a regulatory draft in October, and the four major banks are closely following up with Circle ).

The five major banks are taking action: cross-border remittances, custody, and dedicated teams are fully launched.

Although they claim not to worry on the surface, the five major banks in South Korea have already fully prepared for battle, from establishing internal digital asset teams to negotiating business collaborations.

KB National Bank: Currently studying the use of stablecoins to improve the efficiency of international remittances, and evaluating the possibility of collaboration with global financial institutions. Future plans include participating in SWIFT's cross-border trials to enhance global clearing capabilities.

Shinhan Bank: Conducting technical verification, policy research, and system integration assessment for stablecoins, emphasizing that it is currently not at the commercial stage and is merely a technological reserve.

Hana Bank: is currently reviewing the regulatory requirements, technical needs, and application models for the issuance of a Korean won stablecoin. At the same time, it has established a digital asset task force and intends to apply for a custody license.

Yuanta Bank: Preparing from both technical and business perspectives, dividing into two modes of “external collaboration” and “independent research and development” according to different scenarios, and adjusting strategies in accordance with regulatory developments.

Nonghyup Bank: The internal blockchain team researches CBDC, STO, and stablecoin business, and tests remittances with Korean won and Japanese yen stablecoins, as well as overseas payment cases.

It is evident that the competition surrounding the Korean won stablecoin market has quietly begun.

Institutionalization is imminent: The “Korean Won Stablecoin Era” has only one last mile to go.

The current policy direction of FSC has already opened up, and the government is also working on researching legislation. Now, the Korean won stablecoin is expected to become part of South Korea's financial system, bringing significant changes to payments, cross-border remittances, on-chain finance (DeFi), and the digital asset market.

As numerous enterprises enter the market to reshape industry competition, whether the long-accumulated reputation and experience of the banking industry can enable it to establish a foothold in the future stablecoin system remains to be seen.

This article discusses how South Korean regulators plan to allow companies to independently issue Korean won stablecoins, with all five major banks gearing up for it. It first appeared in Chain News ABMedia.