Key Takeaways:
- KakaoBank explores stablecoin ventures, signaling its intention to enter the digital asset issuance and custody space.
- South Korea’s government pushes for a KRW stablecoin, aiming to prevent capital flight through regulation and innovation.
- KakaoBank onboarded nearly 1M users in H1 2025, with a 19% growth in deposits, showing strong digital banking momentum.
Digital Bank Joins Kakao’s Push Amid Government Crypto Initiative
KakaoBank is also a digital banking unit of South Korea’s tech giant Kakao and is about to enter the stablecoin market, as the country is deepening its efforts to create a digital currency ecosystem backed by the Korean won.
Financial statement of the bank for H1 2025 reveals from Kwon Tae-hoon the chief financial officer (CFO) that the bank is going over new ways of digital asset issuing and keeping. These works are in line with Kakao Group’s stablecoin task force, which is a joint effort of the same team moving towards blockchain finance.
Kwon explains that KakaoBank’s infrastructure in crypto-related risk management is solid, giving as proof the work done in issuing real-name verified accounts and running KYC and AML for virtual asset exchanges. Additionally, the bank states that it was part of the Bank of Korea’s CBDC pilot project and led the parts of transactions, wallets, and remittances during the experiment.
KRW Stablecoin Gains Political and Corporate Momentum
KakaoBank statement has a very strong tie with the political intentions of President Lee Jae Myung who dictates that development of a won-based stablecoin market is of utmost importance The government has recently legislated several bills, covering both liable and promoting areas of stablecoin that are equivalent to the Korean won, aiming to make it risk-free from the capital flight.
Some private sector players, including KakaoPay, have been quite active and have filed stablecoin trademark applications promptly. KakaoBank joining makes the Kakao ecosystem, therefore, the first mover that will lead the stablecoin infrastructure in the South Korean market.
Alongside these developments, KakaoBank reported strong financial performance for the first half of 2025. Operating profits rose 11% year-over-year to 353.2 billion won ($254 million), while deposits surged 19% to 63.7 trillion won ($45.8 billion). The platform added nearly 1 million users, growing its base to 25.86 million, which represents nearly half the population of South Korea.
Summary:
KakaoBank is positioning itself at the forefront of South Korea’s digital currency evolution, aligning with both government policy and corporate strategy. Its potential role in stablecoin issuance or custody strengthens the foundation of a KRW-backed stablecoin market, supported by real-world crypto expertise and strong digital banking growth.
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