Original article by Lee Yeon-woo , The Korea Times

Original translation: Felix, PANews

As the launch of a won-denominated stablecoin has gained momentum, so too has skepticism, with some questioning whether the won-denominated stablecoin can find a competitive advantage against the dollar-dominated stablecoin.

One proposed use case, backed by lawmakers from the Democratic Party of Korea (DPK) and some industry officials, is in transactions related to K-pop music.

They suggest that K-pop platforms adopt stablecoins backed by the Korean won so that fans around the world can make purchases or concert tickets more easily.

"If dollar-denominated stablecoins flood the market, the won could be squeezed out of circulation," said Rep. Min Byoung-dug at an economic policy seminar organized by the Democratic Party.

“To protect parts of the payments ecosystem, we should allow content and platforms with global influence, such as BTS and Galaxy smartphones, to trade in won-denominated stablecoins.”

Stablecoins are cryptocurrencies pegged to real-world assets such as fiat currencies or government bonds, designed to minimize volatility. They enable instant, 24/7 transfers with minimal fees. No intermediaries such as banks or credit card companies are required. Stablecoins are particularly useful for cross-border transactions and withdrawals.

The potential applications of stablecoins are expected to expand further, especially after the United States passed the Genius Act, formally incorporating stablecoins into its regulatory framework.

Supporters of using stablecoins for K-pop payments believe that stablecoins backed by the Korean won could significantly improve South Korea’s cross-border payment infrastructure.

“Stablecoins can simplify the payment process for overseas customers, eliminating the hassles of remittance and currency conversion that usually occur when accessing Korean content,” said Declan Kim, research analyst at DeSpread.

Rosé of the K-pop group BLACKPINK performs at the Incheon Asian Games Main Stadium

International K-pop fans agree that the current payment system is flawed. They told The Korea Times that some websites and apps do not accept foreign-issued bank cards — especially those that require identity verification. In addition, the payment system often crashes during high-traffic times, such as when concert tickets are on sale.

If a stablecoin system is adopted, fans can purchase stablecoins denominated in Korean won through cryptocurrency exchanges and send them directly to the purchasing account, completing transactions more efficiently.

For suppliers, the benefits are clear: once the system is widely adopted, profitability is expected to improve as they can avoid foreign exchange fees and high transaction fees that they previously paid to networks such as Visa.

There is also the potential for additional revenue. Imagine if SMTOWN launched its own stablecoin, such as SMKRW, and used it to sell merchandise directly to fans. The company could earn interest on the funds pre-deposited in users' wallets, just like Starbucks' stored-value cards.

But for consumers, that incentive may not be strong enough — unless certain products are sold only in stablecoins backed by the won.

The current payment system can be frustrating at times, but it’s not unusable. Globally popular platforms like Weverse have introduced a variety of international payment methods.

Moreover, although finance professionals often forget, a large segment of the public is still unfamiliar with cryptocurrencies. If not properly introduced, stablecoin systems could end up being more cumbersome than the traditional payment methods they are designed to replace.

Ryan Yoon, senior research analyst at Tiger Research, said: "The core advantage of stablecoins is that they can eliminate unnecessary intermediaries in the financial system. The most critical factor is to ensure that consumers do not need to manually convert to stablecoins, making the process seamless and not affecting the user experience."

Teenagers practice K-pop dance on the streets near Red Square in Moscow on July 1.

While some international K-pop fans expressed interest in the idea of changing their payment experience, others expressed hesitation. Most said they had never heard of stablecoins before.

One fan from the Philippines likened the move to the previous wave of NFT projects in the Korean pop music industry, which ultimately failed to take off. "They think K-pop fans are easy to market to, but we are more picky."

Another fan questioned whether policymakers truly understood the fan experience. “The government should abandon the idea that ‘if we build it, fans will come’”. “We can’t help but wonder if the policymakers themselves have ever bought tickets to a K-Pop concert.”

Like it or not, it’s still just an idea for now. The Democratic Party of Korea has begun pushing for legislation to formalize the framework for a won-based stablecoin, but specific guidelines have yet to be determined.

Jay Jo, another senior research analyst at Tiger Research, said: “A currency that is limited to use in a single industry, rather than being widely adopted across industries, is unlikely to achieve economies of scale. It is important to consider what tangible benefits a won-backed stablecoin can bring to the Korean economy and not just focus on a single use case.”