BxB Inc., a South Korean company, launched KRWb this week—the first stablecoin pegged 1:1 to the Korean won. Built on Ethereum's ERC20 standard, the token records transactions on the blockchain. The c
BxB Inc., a South Korean company, launched KRWb this week—the first stablecoin pegged 1:1 to the Korean won. Built on Ethereum's ERC20 standard, the token records transactions on the blockchain. The company soft-launched it on Airswap earlier this month before the full release Tuesday, backed by an initial KRW 400 million in collateral.
"We're excited to announce and bring to the global community the world's first provably collateralized Korean Won backed stablecoin," Hwan Kim, CEO and co-founder of BxB Inc., said. "We hope that over time we can grow beyond just a cryptocurrency into a new fiat-to-crypto solution that improves the way we do business in and out of Korea."
South Korea is one of the world's largest crypto markets, with won-based trading representing 30% of global volume. Yet strict capital controls make sending won overseas slow and expensive. KRWb addresses this friction. The token also stands apart by pegging to the won rather than the dollar.
JJ Peterson, co-founder of BxB, outlined the two main use cases. "For local Koreans, it gives them an opportunity to denominate in a KRW derivative in the crypto-economy. This reduces their foreign exchange exposure and simplifies prices. For example, a Korean trader using USDT as their base trading currency might have made more USDT on their investment, but could effectively lose money on the exchange between the USD and KRW, based on fluctuations in price between those two national currencies."
Peterson continued: "For the global market, KRWb is a KRW derivative that can be held offshore. This is a huge benefit for entities with South Korean interests, because it is extremely difficult and/or costly to do so with fiat KRW, given the current regulatory landscape."
BxB recruited QCP Capital, a Singapore-based trading firm, as the first issuance partner. Partners in this role distribute tokens to exchanges and OTC traders, supplying and redeeming KRWb to maintain liquidity. Darius Sit, QCP's managing partner, said: "Korea has always been a strategic but challenging market for us. KRWb is a great solution to many of the problems faced by market participants both onshore and offshore. Beyond crypto liquidity, we are excited to be part of a project that is pioneering new 'fiat-to-crypto' solutions in Asia."
Coblic, a South Korean exchange, and BeQuant, based in the UK, began trading KRWb on Wednesday. Additional exchange listings should follow through Q1 2019. BxB plans to announce more issuance partners.
Peterson said the company intends to introduce multiple use cases for KRWb: payments, lending, margin trading, foreign exchange hedging, options, and more.
