This article was written by Tiger Research. The South Korean crypto market is experiencing a power shift. The era of retail dominance is ending. Traditional financial institutions have begun to frantically seize key infrastructure such as STO standard setting rights, stablecoin payment rails and custody markets before supervision is fully clear. Behind this seemingly peaceful MOU competition is the battle for control of the future digital asset financial front-end - whoever masters these infrastructures will master the customer entrance in the next decade.

Partnerships and equity acquisitions between Korean institutions and securities firms are accelerating in the crypto market. But the overall pattern is still difficult to see at a glance. Announced partnerships are numerous, but actual commercial deployments remain rare. This report explores why conversion rates are so low and why agencies continue to push forward.

Key Points

• Korean institutional encryption activities have gone beyond the MOU (memorandum of understanding, referring to cooperation intention, the same below) stage and entered specific business operations and exchange equity acquisitions.
• Institutions are secretly intensifying competition for critical financial infrastructure, including STO standard development, stablecoin payment rails, and custody markets.
• Domestic infrastructure builders are becoming the core pillars of institutional business, building Korean local tracks that comply with the Bank of Korea’s CBDC framework and local regulatory requirements, and reducing reliance on foreign technology.
• The overseas Web3 Foundation's strategy for entering South Korea has completely changed, from retail community building to cooperation with large enterprises and financial institutions, because traditional finance is accelerating to take over the market.

1. MOU Arms Race

The above chart, compiled by Tiger Research, charts the connections within South Korea’s institutional encryption landscape. But this structure is not easy to see at a glance. It’s difficult to distinguish which lines represent active business operations and which are just MOUs, and the lines between central hubs and edge players remain blurred.

It is worth noting that this complexity itself accurately reflects the current state of the Korean institutional crypto market. As Tiger Research’s data set confirms – 150 institutions and 196 partnerships – no single hub has yet achieved dominant control of the market.

Domestic institutions are simultaneously establishing their position across the market before regulation becomes fully clear. The competition currently revolves around three fronts: stablecoins, STOs (security token offerings), and custody (cryptoasset storage).

It is also worth noting that financial institutions continue to acquire exchange stakes, a move that is interpreted as a confidence-driven grab to gain a foothold before regulation is fully clarified.

2. Battle for exchange equity

Less than 10 days after Hana Bank announced it would acquire a 6.55% stake in Upbit operator Dunamu for about 1 trillion won (about $720 million), Hanwha Investment Securities approved the acquisition of an additional 3.90%. On May 28 of the same month, Samsung Securities, Samsung SDS and Samsung Card jointly announced a joint acquisition of 4.0%. Mirae Asset Advisory signed a contract to acquire 92.06% of Korbit as early as February, and there were reports that Korea Investment Securities and global exchange OKX were discussing a joint acquisition of Coinone.

The competition reflects a revaluation of crypto exchanges, which are now viewed not just as transaction fee platforms but as key customer touchpoints that can distribute stablecoins, custody services, security tokens and RWA products.

Banks and securities firms gain indirect access to licenses such as VASP registration, while ensuring the exchange’s user base and liquidity. The current battle for stake is ultimately a race over who will control the financial front-end of digital assets.

3. South Korea Crypto Market by Industry

An industry-by-industry analysis of the relationship graph reveals an uneven pattern. Hosting operations are the most active, with many players already running live services after clearing regulatory hurdles. In contrast, RWAs and STOs remain largely at the contract or MOU stage, waiting for relevant legislation to come into effect. Stablecoins face similar stagnation, with no clear standard setter in a position to dominate the market.

Because the nature of obstacles in each industry is different, the strategies for breakthrough are also different. Some players are consolidating domestic alliances and await regulatory openings. Others are turning to overseas markets where regulatory advancement is faster, opening up alternative paths. The following sections explore specific barriers and player strategies for each industry.

3.1. RWA/STO: Legislation passed, commercialization infrastructure is bottleneck

The domestic STO market is divided into two camps: the alliance led by KOSCOM and the fragmented investment alliance led by Shinhan Investment Securities. Mirae Asset Securities has taken an independent path, leveraging overseas operations rather than waiting for domestic infrastructure.

KOSCOM, a core financial network operator in which Korea Exchange holds a 76.6% stake, is pursuing a neutral infrastructure model consistent with its founding mission to provide shared infrastructure for securities firms. Rather than signing an exclusive agreement with a single issuer, it integrates 11 securities firms onto its platform, aiming to develop technical standards for issuance and distribution and ensure an interface compatible with Korea's comprehensive custody management requirements for securities depositories.

Shinhan Investment Securities quickly established its own STO ecosystem. Starting with a proof-of-concept with Lambda 256 in 2022, it launched the joint platform PULSE in 2024 and officially launched a multi-platform account integration service in 2025. In 2025 alone, it participated in 10 investment contract securities issuances as an account manager and acquired a controlling stake in OTC exchange NXT, establishing an end-to-end pipeline from issuance to distribution within its own ecosystem.

Mirae Asset Securities completely bypassed domestic infrastructure development and went directly to the sea. It issued digital bonds in Hong Kong, obtained a digital asset retail license from the Hong Kong Securities and Futures Commission, and plans to launch an MTS for retail investors in the market in June. In the United States, it is the only Korean securities firm to join a DTCC-led tokenization working group that includes JPMorgan Chase, Goldman Sachs and BlackRock in global standards-setting discussions. This strategy gives Future Assets an advantage in terms of regulatory alignment and negotiation leverage when domestic STO infrastructure is eventually aligned with global standards.

3.2. Stablecoins: Legislation rather than technology is the bottleneck

Participants in the stablecoin market are more diverse than other industries. Card companies, exchanges, fintechs and infrastructure companies are all entering via different routes, leveraging their respective strengths.

The largest faction is the Kakao Group. Kakao, KakaoBank and Kakao Pay have formed a joint working group to build a "super wallet" covering stablecoins, cryptocurrencies and local currencies. Their key asset is the infrastructure accumulated from operating the Kaia public chain since the Ground X era. Kaia has deployed Tether (USDT) on its network and is testing live payments.

Shinhan Card is focused on migrating its existing payment network to the blockchain track. Shinhan Card signed an MOU with Solana in April, although the technical groundwork predates the agreement. The company has completed initial proof-of-concepts in partnership with Solana, Visa, Mastercard, and Fireblocks and is now conducting advanced testing in six areas, including wallets and smart contracts.

The exchange camp is bypassing Korean won stablecoin delays with USD stablecoins. Dunamu is developing a Korean won stablecoin business with Naver Financial based on its proprietary blockchain GIWA. Faced with regulatory delays for Korean won stablecoins, Bithumb chose to first secure a U.S. dollar stablecoin distribution network through partnerships with Circle and WLF. Plans for a joint Korean won stablecoin with Toss are also being discussed, although progress is slow.

All camps are active but face the same regulatory barriers. The Bank of Korea is pushing for a 51% rule that would require only a coalition with a majority of banks to be allowed to issue stablecoins, while fintech companies are fighting for access, delaying government-ruling party negotiations. Once issuance guidelines are released, the camp with the most comprehensive public exposure is expected to achieve market leadership.

3.3. Custody: more institutional capital required

The hosting market is structurally simpler than other industries. Each of the four major custodians has secured domestic and international financial and technology partners to establish its market position.

KODA was co-founded by KB Kookmin Bank, Hashed and Haechi Labs, combining traditional financial capital and crypto-native VC. Hanwha Investment & Securities, IBK Capital and Kyobo Securities subsequently joined as investors, and a dedicated custody insurance agreement with Samsung Fire and Marine Insurance further enhanced its stability.

KDAC is a custodian led by traditional finance, with Shinhan Bank and NH Nonghyup Bank as major shareholders. NH Nonghyup Bank was originally an investor in another custodian, Kardo, and became a KDAC shareholder after the merger. After the merger, KDAC's shareholders include two of South Korea's five largest banks.

BDACS takes a unique approach centered on technology and partner development. Expanding custody and payments infrastructure through partnerships with Woori Bank and international digital asset infrastructure companies including Galaxy and GK8, it has also signed an MOU with Circle to issue the Korean won stablecoin KRW1 on Circle’s Arc blockchain, and is the only VASP and key custody partner in the KRX-led KDX consortium. BDACS is currently working on a proof-of-concept for KRW1, positioning itself as a custodian targeting both custody and payments infrastructure.

BitGo Korea leverages the technological capabilities of its global parent company to enter the domestic market. BitGo’s headquarters hosts more than $70 billion in assets and handles approximately 20% of the world’s Bitcoin on-chain transactions. Domestically, Hana Financial Group and SK Telecom each hold stakes, making it a custodian backed by financial and telecom capital.

Each institution enters the market through its own custody relationship. However, all major custodians reported net losses last year, suggesting they are building ahead of the inflows of institutional capital needed to stay afloat.

Taken together, the infrastructure construction of STO, stablecoins and custody reveals a clear common limitation: domestic institutions have built business frameworks, but the underlying technical infrastructure still relies heavily on overseas solutions.

4. Infrastructure Builders

Reliance on overseas solutions comes with structural costs: as the market grows, a significant portion of revenue will flow overseas in the form of technology licensing fees. Domestic infrastructure is also at risk of disruption if overseas partners change policies or raise costs.

The more fundamental problem is that areas that need to interface with South Korea's specific regulatory environment - such as Korean won stablecoin issuance, STO distribution rules and domestic corporate account integration - cannot simply apply global solutions directly. This is precisely why domestic technology companies that can directly design and control the underlying tracks in line with South Korea’s regulatory framework will be essential once the relevant legislation is finalized and capital begins to flow in earnest.

Domestic companies that have identified this technology gap and are building Korea-specific financial infrastructure are already taking action. The leading technology providers are as follows.

4.1. LG CNS

Among traditional IT service companies, LG CNS has the clearest stance. Since launching its own blockchain platform "Monachain" in 2018, it has accumulated operational experience by providing services to more than 220 local governments through the Korean Mint's local currency platform.

This permissioned chain experience translated into orders for CBDC and STO projects. As the main contractor of the Bank of Korea's CBDC project "Han River", LG CNS is developing a government subsidy distribution system using deposit tokens. Through this process, it has established the system architecture capabilities to run institutional CBDC and private digital currencies on a single network, effectively porting the security standards and procedures of traditional finance to the blockchain.

The development of KOSCOM joint STO issuance platform and Mirae Asset Securities STO platform follow the same logic. Rather than issuing assets directly, LG CNS is aiming in three directions: building an issuance and distribution platform for banks, providing SaaS to payment operators including credit card companies, payment gateways and simple payment services, and developing a digital asset payment platform for securities companies. It appears to be the most likely candidate to gain access to a market in infrastructure contracts once the regulatory framework is finalized.

Among blockchain infrastructure companies, DSRV stands out for directly helping financial institutions access on-chain infrastructure. As a validator and infrastructure company operating on more than 70 blockchain networks, DSRV manages over 4 trillion Korean won (approximately $2.9 billion) in assets, ranks No. 1 in Ethereum staking in South Korea, and ranks in the top 10 globally.

The key development is its expansion from node operations to full-stack institutional on-chain infrastructure. Through the DSRV Portal, financial institutions can access wallet, payments, tokenization, custody and staking functionality through API and dashboard interfaces. Without having to build their own nodes and security infrastructure, financial companies can access user wallets, institutional wallets, recurring payments, token issuance, destruction, transfer and locking, custody and staking capabilities.

Trust mechanisms are also in place. DSRV was the first to achieve VASP, ISMS and SOC 1 Type 1 certification, directly addressing the regulatory, security and operational control needs required by financial institutions. In practice, this means that external infrastructure providers bear the wallet security, internal controls and operational risks that financial companies most burden when deploying on-chain services.

The partnership is geared towards payment rail construction. DSRV and SBI Ripple Asia jointly develop remittance infrastructure that complies with Korean and Japanese regulations. Working with Circle to develop an institutional USDC issuance, redemption and settlement framework that bypasses exchanges. Signed a stablecoin payment infrastructure agreement with BC Card to connect traditional card payment networks to the blockchain.

DSRV recently completed a 30 billion won (approximately $21.7 million) Series B round of financing to accelerate technology development.

4.3. Altus (formerly B-Harvest)

Altus (formerly B-Harvest) operates at the integration layer between financial institutions’ legacy systems and blockchain environments. Founded in 2018 to contribute to the development of EVM chains based on the Cosmos SDK, the company is an organization of over 40 engineers and researchers who have directly built multiple production networks including Canto, Crescent, Stable, and Ault.

Altus handles protocol engineering and core architecture for Ault Blockchain, an institutional L1 focused on RWA, transactions, and payments. In 2025, it contributed EVM integration, performance improvements, and security audits to Bitcoin staking L1 Babylon, supporting its production readiness.

Its solutions for financial institutions originate from the same layer. Altus is built from the ground up with financial industry requirements in mind: on-chain and off-chain orchestration layers connecting legacy systems and blockchain execution environments, RWA tokenization, permissioned exchanges, stablecoin payments and settlement, and institutional wallet and custody infrastructure.

Current internal R&D is running in parallel: the Canton Network architecture to support selective data disclosure between institutions, and the Commonware Stack, a modular blockchain framework targeting 1 million TPS.

The three companies start from different positions and have different advantages. LG CNS leads with financial IT credibility, DSRV leads with blockchain validator infrastructure, and Altus leads with protocol-level custom design capabilities. But all companies have the same goal: to obtain core operating systems before massive inflows of institutional capital. The deciding factor will be how much credible building experience each company can accumulate before the market fully opens up.

5. Retail investors are out and institutions are entering

The recent surge in cooperation announcements should not be interpreted as ordinary business expansion. These are positioning moves: agencies seize advantageous arrangements before regulation is finalized and then use these arrangements to influence the final shape of the regulatory framework. The current race to cooperate is less about market competition than regulatory design.

The South Korean crypto market has undergone a major shakeup in just six months. Custody camps have formed, STO alliances have taken shape, and major financial holding companies have moved to acquire exchange stakes. At the same time, retail trading volume has dropped significantly. Total trading volume on South Korea's five largest exchanges fell about 48% year-on-year. The market focus is rapidly shifting from retail investors to institutions.

This shift has also changed the way overseas crypto foundations approach South Korea. Just as Solana was adopted as a partner by Shinhan Card and Avalanche was adopted by Mirae Asset, foundations entering the domestic market have shifted their main focus from exchange trading volumes to cooperation with financial institutions and large enterprises. The community meetup model that once drove retail liquidity no longer works.

The results of this market restructuring are expected to be revealed at KBW 2026 in Seoul in September 2026, an event that always reflects prevailing market conditions. Looking at the list of confirmed speakers, traditional finance professionals already account for the majority. Last year overseas foundations competed through token-incentivized community-side events, and this year the focus is expected to shift to substantive business discussions.

Tiger Research is the official research partner of KBW 2026.