According to industry officials on Sunday, major holding businesses in Korea are rushing to establish alliances with major tech companies, such as Naver, Kakao, and Samsung Electronics, in order to have an advantage in the rapidly developing stablecoin market.
Despite the market not yet being completely authorised, domestic stablecoin transaction volumes have already surpassed 60 trillion won ($41.15 billion), according to KB, Shinhan, Hana, and Woori.
A bill for stablecoins
In response, financial regulators are getting ready to provide the National Assembly with a statute governing stablecoins by the end of 2025.
Banks, the holding companies’ main business divisions, are seen as feasible possibilities to act as principal issuers of stablecoins linked to the Korean won, either individually or through a cooperative consortium with associated institutions, but negotiations are still underway.
“Under these circumstances, alliances with big tech firms are considered essential, since it would take banks considerable time to develop the necessary technology on their own,” an industry official said.
“Tech giants, on the other hand, already have strong platform ecosystems and are best positioned to secure practical use cases once stablecoins are issued.”
Race for stablecoins
Credit card, insurance, securities, and asset management units are among the other affiliates within the holding groups that must get ready for stablecoin-related services, including risk and reserve management and integrating digital currencies with current payment and remittance systems.
Naver has already been working with KB Financial Group, Shinhan Financial Group, and Hana Financial Group on collaborative product launches and other projects.
By leveraging the conglomerate’s long-standing primary banking connection with Woori Bank, Woori Financial Group is bolstering its partnership with Samsung Electronics.
With Woori Bank serving as the exclusive operator of Samsung Wallet Money and Points, the partnership includes Samsung Wallet, which is based on Samsung’s Galaxy handsets. The digital asset custody company BDACS has received a 5% investment from Woori Financial Group.
“While companies like Naver and Kakao are expected to take leading roles in the crypto market by partnering with financial firms, Samsung Electronics also has the capability and operational capacity to issue and manage coins,” another industry officer said.
Financial organisations are also growing their crypto-related teams and carrying on with internal testing and verification.
On the other hand, the South Korean National Tax Service (NTS) has issued a warning that cryptocurrency assets stored in cold wallets may be confiscated as part of its increased efforts to combat tax evasion.
This measure comes after many continue to believe that the government is unaware of cryptocurrency income and transactions. As a result, tax evasion is simpler here than with traditional assets.