KRWQ aims to bring a fully compliant, multichain Korean won stablecoin to global DeFi markets as South Korea prepares new legislation for digital currency regulation.
Frax and IQ Introduce Korean Won-Pegged Stablecoin KRWQ
Crypto protocol Frax and AI agent platform IQ have launched KRWQ, a stablecoin pegged to the Korean won, marking a major step in South Korea’s evolving stablecoin landscape. The new token went live on Base, the blockchain ecosystem backed by Coinbase, and debuted with a KRWQ/USDC trading pair on Aerodrome Exchange.
According to project details, KRWQ is fully backed and designed to comply with South Korea’s upcoming regulatory standards. The token stands out as the first multichain won-denominated stablecoin, thanks to integration with LayerZero and Stargate Finance, allowing seamless transfers across multiple networks.
Regulatory Push Drives Innovation
South Korea’s government has been intensifying efforts to create a framework for local currency stablecoins, encouraging banks to take a leading role. However, this approach has drawn debate within the crypto industry.
Dr. Sangmin Seo, chair of the Kaia DLT Foundation, emphasized the need for balance, saying the central bank should establish “clear rules for stablecoin issuers that can minimize monetary risks and foster innovation.”
Reflecting this regulatory momentum, the teams behind KRWQ explained that the project was “developed in anticipation of forthcoming stablecoin legislation” currently under review by lawmakers.
IQ co-founder Navin Vethanayagam said,
While KRWQ is fully regulatory-compliant, its launch team clarified that the token is not being marketed to South Korean residents. Instead, it targets global decentralized finance (DeFi) ecosystems, with minting and redemption restricted to verified KYC counterparties, including exchanges, institutional partners, and market makers.
Growing Competition in Won-Backed Stablecoins
The release of KRWQ comes shortly after South Korean custodian BDACS announced plans for its own stablecoin, KRW1, which operates on Circle Internet Group’s new Arc blockchain and the Avalanche network.
As the race to issue compliant, won-backed digital assets accelerates, KRWQ’s launch highlights South Korea’s push toward merging regulatory oversight with blockchain innovation — setting the stage for broader stablecoin adoption in Asia’s rapidly evolving crypto market.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.