KB Financial Group has completed a proof-of-concept for a won-denominated stablecoin payment system, showing international remittances that clear in three minutes at roughly an 87% lower fee than traditional SWIFT transfers. The pilot, which integrated issuance, offline payments, merchant settlements and cross-border transfers into a single blockchain workflow, also tested QR-code payments at a Hollys coffee shop — without requiring customers to install a digital wallet.
A three-minute cross-border test
The stablecoin pilot processed international remittances in about three minutes. Transaction fees dropped by approximately 87% compared to conventional SWIFT methods. KB Financial Group ran the PoC as a single end-to-end workflow covering issuance, offline payments, merchant settlements and the remittance leg — a structure the bank sees as a blueprint for real-world use.
Offline payments without a wallet
One of the more practical tests involved offline kiosk transactions at a Hollys coffee shop. Consumers paid using a QR code without needing to install a dedicated digital wallet. The setup points to a possible path for mainstream adoption: letting people spend stablecoins through familiar interfaces rather than forcing them into a new app.
Regulatory standoff stalls stablecoin law
The pilot lands at an awkward time for South Korea's crypto rulebook. The second phase of the Virtual Asset User Protection Act — often called the Digital Assets Act — has been stalled since December 2024. The holdup is a dispute between the Financial Services Commission and the Bank of Korea over stablecoin reserve requirements. The BOK wants banks to hold at least 51% of any stablecoin issuer's reserves. The FSC argues that threshold would scare off tech firms and stifle innovation.
In April 2025, lawmakers urged the National Assembly to prioritize stablecoin legislation, warning that South Korea is falling behind globally. Professor Ahn Soo-hyun noted that the country accounts for 10% of global digital asset transactions but is lagging on crypto regulation.
Won-pegged stablecoins as a competitive tool
Bank of Korea Deputy Governor Chang Cheong-soo said won-pegged stablecoins could serve as a complementary and competitive payment method for virtual asset transactions and cross-border payments. His comment suggests the central bank sees promise in the technology even as it pushes for tough reserve rules. The standoff between the BOK and the FSC shows no sign of breaking — and until it does, South Korea's stablecoin ambitions will stay in the proof-of-concept stage.
