KRW1 is a 1:1 pegged, bank-backed stablecoin issued by digital asset custodian BDACS, launched in September 2025. It operates on the Avalanche blockchain and is fully collateralized by Korean won deposits held in escrow at Woori Bank, with a successful proof of concept already completed. This instrument provides a direct on-ramp for won-denominated digital assets, aligning with Korea's advanced RWA regulatory environment established by recent amendments to its Capital Markets Act.
The launch creates a new liquidity channel for institutional investors. By integrating KRW1 into its ecosystem, Plume, a major RWA platform, enables Korean institutions to invest and receive returns directly in won. This reduces foreign exchange costs and operational friction, lowering the barrier to entry for a market with strong institutional demand and clear regulatory support.
BDACS's strategic partnership with Galaxy Seoul provides the institutional infrastructure to scale this channel. The collaboration, announced in April 2025, focuses on institutional prime services and ETF infrastructure. This partnership gives BDACS the global liquidity and custody capabilities needed to support KRW1's growth and facilitate broader trading and tokenization activity in the Korean market.
Real-World Use Cases: Driving On-Chain Volume
The primary driver of on-chain volume for KRW1 is its integration with Plume, a major RWA platform. Plume's ecosystem, which already hosts more than 280,000 RWA holders and $645 million in RWAs, now allows Korean investors to make payments and investments directly in won using KRW1. This partnership directly injects won liquidity into the blockchain, reducing foreign exchange costs and operational friction for institutional participation.
A second key partnership aims to expand the stablecoin's utility beyond investment. BDACS and gaming giant Com2uS Holdings have agreed to build a digital asset payment system around KRW1. This collaboration, formalized through a Memorandum of Understanding in March 2025, targets joint research and development to enhance the stablecoin's use for everyday transactions and services, broadening its real-world adoption.
Underpinning these initiatives is BDACS's broader institutional infrastructure strategy. The firm leverages Ripple Custody to provide custody services for assets like XRP and the RLUSD stablecoin. This partnership with Ripple supports the growth of the XRP Ledger and provides a secure, bank-grade foundation for institutional crypto operations, reinforcing the technical backbone needed for KRW1's scaling and ecosystem expansion.
Catalysts and Risks: Flow vs. Regulatory Headwinds
The primary catalyst for KRW1 adoption is the expansion of the Plume ecosystem to Korean institutions. Plume's decision to select the won as its first non-USD currency reflects Korea's regulatory readiness and institutional demand. By integrating KRW1, Plume opens a direct pathway for Korean investors to enter its world's largest RWA ecosystem using won, reducing FX costs and operational friction. This partnership is the most immediate source of won liquidity and institutional flow for the stablecoin.
A major risk to its growth trajectory is increasing regulatory uncertainty and competition. Other Korean banks are actively filing for won stablecoin trademarks, with at least three local financial institutions including Kakao Bank and Kookmin Bank in the race. This competitive landscape could fragment the market and complicate the regulatory approval process for all entrants, creating headwinds for BDACS's first-mover advantage.
The partnership with Netstars in Japan signals a broader strategy to build payment rails, but its success is contingent on local regulatory approval. While Aptos and Netstars aim to develop stablecoin and Web3 payment applications in Japan, the project is in an exploratory phase. Its potential to drive flow for KRW1 or similar assets depends on navigating Japan's cautious but progressive regulatory environment, which remains a key dependency.