What Korea Teaches About Institutional Infrastructure for Digital Assets

The Korean won accounts for roughly 30% of global crypto spot trading, second only to the US dollar, from a country of 52 million people.

In July we hosted Current Seoul, a closed-door session at the Josun Palace for senior leaders across Korea's banks, exchanges, payment companies, and super-apps to discuss Korea’s crypto inflection point. When it came to the depth of the retail market specifically, Sean Kim, Head of Sales and Trading at Presto, remarked: 

Korean trading is like [a] second job to build their own house.”

Korea is often seen as a retail market because institutional activity has been relatively low; from 2017 Korean corporates were not permitted to hold or trade digital assets at all. South Korea’s Financial Services Commission only lifted that nine-year ban this year.

While institutional infrastructure for digital asset value exchange in Korea is nascent, my conversations with event attendees underscored the potential opportunity. Yet capturing this opportunity presents distinct challenges — challenges that mirror those facing other global capital markets. As conversations at Current Seoul revealed, developing regulation and recent institutional investments are signalling a shift in priorities for senior leaders. The following three perspectives capture important themes and lessons for capital markets decision-makers navigating Korea’s rapidly developing market.

How Korean financial institutions are entering digital asset markets

The regulation is not finalized yet, but already big players in Korea invest a lot in crypto exchanges these days… So I think two different worlds are merging to a certain point.”
Sean Kim, Head of Sales and Trading at Presto

Sean Kim’s comment relates to recent announcements where Hana Financial agreed to buy 6.55% of Dunamu, which operates Korea's largest exchange, as well as Samsung, which took a stake weeks later. The Hana deal carries a joint development program covering won-pegged stablecoins, blockchain remittances and tokenized securities, agreed before the Digital Asset Basic Act was finalized. This is significant validation from a commercial bank on the opportunity to develop new engineering, compliance and operations capabilities in institutional infrastructure. 

Unlike banking or payments, capital markets have had few competitive shocks in recent memory—there have been few new entrants and limited innovation beyond price. Yet here we have a traditional financial services company taking a stake in a crypto trading firm, committing to build capabilities that sit squarely in capital markets—securities issuance, custody, and asset servicing. I see that as traditional financial institutions are now actively pricing in the long-term potential of digital assets and are moving from observation to direct participation. This is a trend global capital markets companies should note as regulatory clarity emerges.

Why capital markets need interoperable digital asset rails 

Interoperability is another problem. And the liquidity of different currencies are also [another] problem that we need to solve.”
Allen Shin, CEO, Kakao Pay

Interoperability is not a single issue. It must exist across three key areas: assets, currency pairs, and settlement rails. When it exists between assets, tokenized security can settle against cash or a stablecoin with synchronized finality. Between currency pairs, it allows the won-dollar leg clears without artificially warehousing risk. And across settlement rails it enables value to move seamlessly between blockchains and existing payment systems. Each of these is a component of a broader, highly complex system that demands coordination.

But driving consensus is the hard part. There are at least four separate groups currently developing won-pegged stablecoins in Korea: an eight-bank coalition, Kakao’s alliance with banks, a Naver-Dunamu-Hana bloc, and BDACS with KRW1. These coalitions often share bank participants and each sees its approach as a viable standard. However, the dominance of a particular standard will hinge on broad-based adoption, not just technical superiority; technical excellence alone does not determine market winners in complex capital systems.

Even the question of which assets should be widely accepted is unsettled. The Financial Services Commission has debated whether dollar stablecoins should be permitted on corporate balance sheets, while the Bank of Korea warns of capital flight risk — a tension relevant beyond Korea. We reviewed both debates in our previous Current blog: Korea's Head Start.

As more institutions invest in digital asset infrastructure and the number of asset types and trading venues multiplies, the business case for robust interoperability strengthens. Global organizations must plan proactively: first, by making interoperability a core assessment criterion for any digital asset platform, asset, or settlement rail, and second, by preparing to handle major dollar-denominated stablecoins, even before local regulatory consensus is achieved.

Build, partner, or buy: how institutions are approaching digital assets

It's not possible for one company with just a few companies to solve, but a kind of big partnership or collaborations are required.”
Allen Shin, CEO, Kakao Pay

Allen Shin’s observation reflects the reality in Korea: Hana’s position in Dunamu, Samsung’s subsequent investment, Kakao’s bank alliance, and the Naver-Dunamu-Hana bloc all exemplify how industry leaders are choosing partnership approaches. Partnership is fast becoming the default for digital asset expansion not only due to scale, but in response to both regulatory complexity and rapid technical evolution.

For major institutions, the preference for partnerships is driven by the need to both manage compliance risk and gain access to specialized technology—challenges exacerbated by the fast-changing regulatory environment and the global nature of digital asset markets. Consequently, for global organizations, success means shifting from questioning if partnerships are required, to defining robust partner selection processes that emphasize technical capability and deep regulatory expertise.

From our perspective, two criteria are decisive: partners must possess technical capabilities that keep pace with digital asset innovation, as well as deep regulatory experience that spans both South Korea’s changing rules and global frameworks. Parties lacking either will struggle to deliver competitive and compliant solutions. In this context, recent moves—such as Circle’s memorandum of understanding with Kakao—underscore how these criteria are shaping institutional strategies.

Regulatory uncertainty is no longer a reason to wait

Korea's ban on corporations holding or trading digital assets highlights how legislative clarity can unlock new business models and drive market participation. Korea’s Digital Asset Basic Act is scheduled for completion by year-end; similar deadlines are now set globally—MiCA's authorization deadline passed on 1 July 1st 2026, the GENIUS Act takes full effect by January 2027, the UK opens its gateway later this year, and Hong Kong granted its first stablecoin licences in April.

For most of the last decade, waiting for regulatory clarity was the prudent stance. Now it is increasingly a liability. Each milestone turns compliance from a theoretical concern to a binding requirement, often within overlapping timeframes. Crucially, what regulatory clarity makes possible is not only the launch of technical initiatives, but decisive action in forming strategic partnerships and building infrastructure. In short, clarity pushes organizations to move from holding back to actively deciding who to work with, and on what terms. This marks a critical turning point for both local and global capital markets firms.