South Korea’s KB Financial Group, the parent company of KB Kookmin, completed a stablecoin pilot project for offline payments, settlements, and cross-border remittances.  The company announced on May 17 that it used the Kaia blockchain for the test.

KB conducted a proof-of-concept (PoC) for KRW stablecoin payments and settlements in collaboration with KG Inicis, Kaia Blockchain, and OpenAsset. The initiative addressed the entire lifecycle of using digital money, from issuance and payments to settlement, inside an integrated framework, according to a Yonhap News article. 

KB Kookmin is the biggest bank in South Korea, with total assets of about 584.9 trillion won ($266.7 billion). 

The stablecoin pilot program expands the number of South Korean traditional banking institutions testing with stablecoins. Shinhan Card, one of the country’s largest credit card companies, and the Solana Foundation inked a memorandum of understanding in late April to test stablecoin payments. 

KB Financial explores stablecoins for faster remittance

BREAKING: South Korea’s largest bank, KB Kookmin, successfully pilots KRW stablecoin integration for offline payments and global remittances on @KaiaChain. 🇰🇷 pic.twitter.com/fkYNLndVBu

— Kaia (@KaiaChain) May 17, 2026

During KB Financial’s experiment, the feature used Kaia’s on-chain liquidity to convert Korean Won stablecoins into Dollar stablecoins for the international remittance verification procedure.  The dollar stablecoins were then transferred into a bank account through a local partner in Vietnam. 

According to local reports, the test cut prices by 87% and reduced transfer times from days to just 3 minutes. Holly’s, a coffee franchise in Seoul, conducted an offline payment test, allowing customers to pay via QR codes without installing a Bitcoin wallet. 

After the project verification, a KB Financial Group official stated, “We will do our utmost to provide lifestyle-oriented digital financial services that customers can experience in their daily lives by combining blockchain technology with financial infrastructure based on verified stability and trust.” 

Bank-led stablecoins reshape South Korea’s payments future

Banks are viewing stablecoins as the next step in regulated digital payments. Financial institutions across Asia are exploring stablecoin-based infrastructure that can process transactions in less than an hour, in contrast to traditional banking rails, which frequently take two to five business days for international transfers.  

Cross-border remittances remain one of the best use cases because users care more about timeliness, lower fees, and consistent settlement than about the underlying technology. According to Finextra, banks increasingly see stablecoins as a 24/7 settlement rail that enhances liquidity efficiency and lessens reliance on pre-funded accounts, and remittance corridors are where traditional banking systems pose the greatest challenge.

South Korea’s regulatory approach may hasten mainstream adoption, as policymakers increasingly favor bank-led stablecoin issuance over uncontrolled private issuance. According to a June 24, 2025, report by Cryptopolitan, the Bank of Korea supports gradually implementing won-based stablecoins, though only strictly regulated commercial banks first. 

Bank of Korea Senior Deputy Governor Ryoo Sang-dai said, “It is desirable to first allow banks, which are under a high level of regulations, to issue won-based stablecoins and gradually expand to the non-bank sector with the experience.”  He also affirmed that the government is working on reforming the foreign exchange market.

Ryoo added that the authorities intended to expedite the opening of South Korea’s currency market to more overseas investors as digital finance expands. This came after the 2024 decision to expand FX trading hours and give foreign companies greater access. 

KB Financial is reportedly preparing to launch stablecoin services in Korea once digital asset rules are approved. However, disputes among regulators over who should be permitted to issue stablecoins have frequently stalled the nation’s proposed Digital Asset Basic Act.

Cryptopolitan reported on December 30 of last year that the Financial Services Commission cautioned that strict regulation could impede innovation, while the Bank of Korea (BoK) maintained that banks should maintain majority ownership in stablecoin issuers.

If you’re reading this, you’re already ahead. Stay there with our newsletter.