South Korea’s Kakao Bank advances Kakao Coin stablecoin initiative to development phase

South Korea’s Kakao Bank is advancing its stablecoin initiative to the actual system development phase of the Kakao Coin. The initiative follows the previous group-wide review of a KRW stablecoin project and the development stage.

Kakao is embarking on its commitment to implement its stablecoin strategy through its core affiliate, Kakao Bank. According to the bank’s website, Kakao Bank has recently begun onboarding developers for its blockchain-based service system. 

Kakao hires developers to design new blockchain service structures

According to a report from local media, the recruitment is part of the bank’s New Business Service Development Team. The bank has tasked the developers with designing new blockchain service backend structures, building transaction processing systems, and managing keys.

The position requires an understanding of blockchain service backend systems, including full-node operation, token standards, and smart contracts. The initiative to hire blockchain devs suggests that the bank is planning to build and operate a range of financial services, such as stablecoins and tokenization.

Kakao Bank’s stablecoin initiative comes after the firm was cleared of the burden of legal risk after Kakao’s founder, Kim Beom-soo, was cleared in his first trial last month. Cryptopoitan previously reported that Kim had been charged with manipulating SM Entertainment stock prices, but was acquitted in the first trial.

Kakao’s financial business expansion was at risk due to Kim’s legal problems, which elevated uncertainty as financial authorities were about to conduct their six-month shareholder eligibility review. Kakao was also expected to reduce its stake in Kakao Bank from its current 27.16% to the 10% limit if a fine or heavier penalty were deemed to make Kim ineligible.

The cut was expected to strip Kakao of its status as the largest shareholder of Kakao Bank and ultimately limit its ability to pursue new business initiatives. Founder Kim serves as the head of Kakao’s Future Initiative Center. The formal commitment is responsible for the group’s future growth in sectors such as blockchain and artificial intelligence (AI). The initiative also oversees Kakao’s mid- to long-term strategy, including its stablecoin business.

Kakao has focused on the Korean won stablecoin as its key future business, launching the Korean Won Stablecoin Joint Task Force (TF) in late August. The task force includes the group’s major affiliates, including Kakao, Kakao Bank, and Kakao Pay. 

The three representatives have reportedly been holding weekly meetings, allegedly discussing the establishment of a digital financial system around settlements, tokenization, and blockchain-based payments. Kakao Pay also recently filed for six stablecoin ticker symbols, including KKRW, PKRK, KRWP, KRWKP, KPKRW, and KRWK.

Kakao seeks to develop STO financial products

Kakao has also advanced its blockchain strategy by signing partnerships with Korea Investment & Securities and Lucent Block. The collaboration aims to develop blockchain-based STO financial products and systems. The token offers a form of digitized securities that use blockchain to verify ownership, status, and dividend rights through smart contracts.

The hiring of blockchain developers marks a significant advancement in Kakao Bank’s blockchain strategy, moving it to the development phase. The initiative also aligns with the group’s goal of developing a stablecoin ecosystem that connects its blockchain infrastructure to its financial services.

A Kakao Bank official mentioned that the recruitment aims to supplement human resources for research on blockchain and stablecoin technology. He added that the initiative also seeks to examine the applicability of blockchain to financial services.

Another South Korean tech giant, Naver Financial, also reportedly launched a wallet service for a Busan-based stablecoin project. The firm is also planning to merge with South Korea’s largest cryptocurrency exchange, Upbit, as part of the initiative.

South Korean firms’ stablecoin initiatives come as the country’s recently elected President Lee Jae Myung named the Korean won-stablecoin as one of his key agendas. He promised to advance Korea’s financial services to protect monetary sovereignty against the dominant U.S. dollar stablecoin market.

The country’s ruling party also recently introduced stablecoin legislation, the Digital Asset Basic Act, which sets a framework for the regulated issuance of asset-backed digital tokens.

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