Nonghyup Bank Completes Verification of K-pop Token Securities Subscription and Distribution Using Stablecoins

Minimizing Exchange Rate Risk with Korean Won Stablecoin

NH Nonghyup Bank announced on January 28 that it has completed a proof of concept (PoC) for the subscription and distribution process of K-pop copyright token securities (STO) utilizing stablecoins.

Nonghyup Bank signed a business agreement with Aton and Musicow in August of last year and has since been verifying the potential of financial services using blockchain technology.

This PoC focused on a scenario in which overseas fans use a Korean won-based stablecoin to subscribe to and invest in K-pop copyright STOs.

Nonghyup Bank explained that by applying a Korean won stablecoin as the subscription method, it was able to minimize exchange rate risk and establish a structure in which the entire process from subscription to settlement could be processed transparently and in real time using blockchain technology.

Based on these results, Nonghyup Bank plans to conduct a second PoC in its own blockchain mainnet environment by the second quarter. In the second phase, the bank will move beyond conceptual validation to virtually issue its own stablecoin and design and test the entire process from subscription to allocation and settlement.

In particular, the second phase will utilize Nonghyup Bank's Ethereum Virtual Machine (EVM)-based proprietary blockchain mainnet, which operates on a public cloud. By applying token protocols to both stablecoins and STOs, the goal is to build a minimum viable product (MVP) model that considers interoperability with various blockchains and digital assets in the future.

Meanwhile, Nonghyup Bank is also jointly conducting a 'Tax Refund Digitization PoC' with global technology and payment companies such as Fireblocks, Avalanche, Mastercard, and Worldpay, to digitize the value-added tax refund process for tourists.