Upbit & Naver Pay Plan Korean Won Stablecoin Amid Growing Regulatory Interest

Private Sector Leads Korea’s Stablecoin Push with Cautious Government Support

Crypto exchange Upbit (via parent company Dunamu) and fintech firm Naver Pay have unveiled plans to jointly develop a Korean won-pegged stablecoin. The initiative aims to modernize digital payments and address market inefficiencies like the notorious Kimchi Premium—a persistent price gap between Korean and global exchanges.

President Lee Jae-myung’s administration supports private-led stablecoin development, but the Bank of Korea remains cautious, calling for “a gradual introduction led by regulated financial institutions to preserve forex and capital control stability.”

Tech and Compliance: A Carefully Measured Rollout

Naver Pay Leads Development, Dunamu Provides Blockchain Infrastructure

Naver Pay will lead product design and integration, while Dunamu supports technical deployment using scalable blockchain architecture. The proposed stablecoin could be compatible with major crypto wallets and interoperable with USDT, USDC, and other global stablecoins.

However, no official launch date has been confirmed as the companies await clarity on South Korea’s evolving regulatory framework. A Naver spokesperson noted the project will move forward “once the necessary legal structure is in place.”

Market Efficiency Gains Possible—But Not Guaranteed

If fully implemented, a won-pegged stablecoin could reduce the Kimchi Premium by increasing liquidity and cross-border swap functionality. Arbitrage inefficiencies may decline as stablecoin use expands and users gain better access to global liquidity.

Still, these benefits depend on actual on-chain interoperability and legal approvals. Market watchers are cautiously optimistic.

Banks Join the Stablecoin Race as CBDC Takes a Backseat

South Korea’s central bank recently paused its CBDC project in favor of supporting private sector innovation. Following that move, banks including Shinhan, KB Kookmin, Woori, and Citibank Korea have announced stablecoin pilots under consortium models.

Bank of Korea officials, including Deputy Governor Ryoo Sang-dai, warned that stablecoins should not disrupt foreign exchange markets. Central Bank Governor Rhee Chang-yong said he’s “not opposed to won-backed stablecoins,” but emphasized potential risks to capital flows and increased demand for USD-backed tokens.

Source: coincentral

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Disclaimer

This article is for informational purposes only and does not constitute legal or financial advice. The development of stablecoins remains subject to regulatory uncertainty and market risk. Readers are advised to conduct independent research or consult a licensed financial advisor before making investment decisions. MyITS disclaims liability for any actions taken based on this content.