From buying coffee at Starbucks to purchasing lipstick at Olive Young, a growing number of Koreans are embracing stablecoins for everyday payments, often through overseas third-party payment platforms. I’ve made payments using stablecoins for an Americano at a cafe, as well as at pharmacies, restaurants, taxis and most other places. I mostly use the dollar-pegged USDT, as it can be easily obtained in both domestic and international exchanges, and its transfer fees are relatively low.
Total transactions of dollar-pegged stablecoins — USDT, USDC and USDS — jumped more than three-fold, rising from 7.1 trillion won ($4.86 billion) in June last year to 23.4 trillion won in October across Korea’s five crypto exchanges. This flow may be only transitory, however. In the future, payments will be made entirely with stablecoins, without any intermediaries.
A model from the local startup Kona I demonstrates the use of a won-pegged stablecoin, tentatively named KSC. KSC is a stablecoin version of local currency that can be registered with services like Samsung Pay or loaded onto prepaid cards for use at local currency merchants. The first won-pegged stablecoin — KRWQ — was launched in October by AI agent platform IQ in partnership with Frax, but it cannot be directly traded by residents in Korea. The success of KRWQ, combined with the fact that Koreans are active stablecoin traders, could tempt more companies to issue won-pegged stablecoins.
To unlock the stablecoin’s potential, a facilitator that can replace the role of the intermediaries will need to emerge. Korea is moving toward allowing the issuance of won-denominated stablecoins initially through a bank-led consortium, before gradually expanding issuance rights to fintech companies, according to local media reports. The regulators also clash over whether to establish a new consultative body to license stablecoin issuers. In November, Naver agreed to acquire Dunamu, operator of Korea’s largest crypto exchange, Upbit. Mirae Asset Group has also opened talks to buy crypto exchange Korbit, Korea’s fourth-largest crypto exchange, according to local media reports. The government plans to introduce a new stablecoin law in the first quarter, according to the Ministry of Economy and Finance.
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