The KRW1 stablecoin launch marks a pretty significant milestone for South Korea’s digital asset sector right now, with Seoul-based BDACS introducing what is the first fully operational won-pegged stablecoin on the Avalanche blockchain. This particular won-backed stablecoin features real-time proof of reserves, which addresses some transparency concerns while the country is preparing comprehensive stablecoin regulations for October.
KRW1 Stablecoin Launch: Avalanche, Won-Backed Collateral & Proof-Of-Reserves
BDACS announced the KRW1 stablecoin launch on September 17, and this came after they conducted a successful proof-of-concept with Woori Bank. Each KRW1 token actually maintains 1:1 collateralization with Korean won that they hold in escrow, along with real-time proof of reserves providing continuous verification through API integration.
BDACS selected the Avalanche blockchain for its security capabilities and also performance, with the company making plans to expand to additional networks. This won-pegged stablecoin supports peer-to-peer transfers, payments, remittances, and even potentially government emergency relief programs.
BDACS CEO Harry Ryoo stated:
“We are building the backbone of the digital asset market, serving corporate, institutional, and public-sector partners alike. KRW1 marks a turning point for our company, and we believe it will become a foundational asset for the digital economy.”
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Market Effects and New Rules
The KRW1 stablecoin launch follows earlier pilots like KRWIN, which is building momentum in South Korea’s won-backed stablecoin sector right now. Local surveys show strong demand among citizens who are already using dollar-backed tokens like USDT and also USDC for trading.
The Financial Services Commission of South Korea is also actively working on the regulations of stablecoins that will appear in October as the second phase of the Virtual Asset User Protection Act. This framework will lay standard requirements on issuance of stablecoins as well as the management of collatels.
A bank official had this to say:
“There is a shared sense of crisis that if things continue this way, foreign dollar coins could dominate the domestic market. It is time to secure both the independence and competitiveness of the domestic financial system through a won-based digital currency.”
Also Read: Tether to Launch US-Based Stablecoin USAT
The KRW1 stablecoin launch positions South Korea as a leader in domestic digital currency development, with the won-pegged stablecoin serving as core infrastructure for the country’s digital transformation alongside Avalanche blockchain technology and real-time proof of reserves.