• KakaoBank is taking advantage of a regulatory push to enter stablecoins.
• A vast mobile user network offers a growth platform.
• Kakao Group is implementing a well-coordinated plan in order to dominate the digital assets.

The digital banking giant of South Korea, KakaoBank, is making a big move into the stablecoins market as it tries to use the recent wave of regulatory interest to issue a stablecoin backed by the won. 

This action has been corroborated in KakaoBank’s 2025 earnings report, which implies that the bank is also making a significant and aggressive shift to incorporate blockchain-enabled assets in mainstream finance with its proven, robust user base and its regulatory compliance systems in place.

Having more than 25 million users, which is close to half of the nationwide population, KakaoBank is a unique entity that might expedite the adoption of digital currencies pegged to the Korean won. 

Kwon Tae-hoon, CFO of the bank, announced that the bank was going to issue and custody cryptocurrencies and work with the stablecoin task force of the Kakao Group, together with the Kakao, KakaoPay, and even KakaoBank branches. This is an indication of a determined group competition to innovate on stablecoin offerings.

Why Stablecoins? Why Now?

Stablecoins are cryptocurrencies that are on par with some kind of stable commodity, most commonly the South Korean won, which act as a bridge between conventional banking and blockchain technology. 

This legislation will be on track with the regulatory ambitions of President Lee Jae Myung to prevent capital flight and support financial innovation by domestic stablecoins.

This is opportune since the government is preparing to create laws to govern the issuance of stablecoins directly between banks and fintech companies. The complex crypto regulatory environment benefits from the bank’s three-year experience supplying genuine names verified accounts of virtual asset exchanges and monitoring KYC/AML.

Also, KakaoBank has been involved in the central bank digital currency (CBDC) experiment in the Bank of Korea, which is an important lesson in the operation of wallet systems and remittance systems.

KakaoBank’s Financial Muscle and Market Edge

A rise of 353.2 billion won, or $254 million, was recorded by KakaoBank during the first half of 2025. This was an increase of 11%. There was a 19% increase in deposits, reaching 63.7 trillion won ($45.8 billion).

This sound financial position will help the bank venture into stablecoins during the rising competition by Kookmin Bank and the Industrial Bank of Korea, which have also tried to register KRW stablecoin trademarks.

KakaoPay (owned by Kakao Group) had registered 18 trademarks associated with stablecoins in June 2025, which demonstrates the desire of the group to conquer the digital asset market in South Korea. 

For the purpose of encouraging the use of stablecoins, KakaoBank can make use of KakaoTalk and the rest of the large mobile ecosystem that Kakao has created.

A Digital Finance Revolution?

Analysts see the developing stablecoin economy in South Korea as a necessary step in the more widespread adoption of blockchain technology beyond the realm of gambling. 

One of the leaders of this transition is KakaoBank, with its powerful infrastructure and regulatory compliance. The analysis team at the bank observed that stablecoins could facilitate day-to-day money transfer, which would make the financial system more efficient and secure.

The regulatory framework is still in the making, yet it is likely that the regulatory initiative by KakaoBank will establish the industry in terms of compliance and innovation. With the government trying to protect against capital outflows, these domestic stablecoins are soon to become common digital payment instruments.