Blockchain network Injective has entered into a memorandum of understanding with South Korean digital asset custodian BDACS to bring a won-backed stablecoin to its tokenized asset markets, a move that could allow institutions to settle transactions without relying on US dollar stablecoins.

According to a Tuesday announcement, BDACS's KRW1 stablecoin would serve as the exclusive won-denominated settlement asset for real-world assets (RWAs) on Injective, enabling institutions to trade and settle tokenized assets directly in Korean won.

BDACS says KRW1 is fully backed by Korean won reserves. Minting and redemption would initially be limited to approved institutional partners, subject to regulatory approval.

The agreement comes as South Korea develops rules for won-backed stablecoins under its proposed Digital Asset Basic Act, which the government aims to finalize by the end of 2026. In the meantime, the country's five largest crypto exchanges recorded net stablecoin outflows for 18 consecutive months through June, according to industry data cited by Cointelegraph. That stretch has coincided with the absence of a finalized domestic framework for won-backed issuance — a gap the proposed act is intended to fill.

Injective is a layer-1 blockchain that has increasingly focused on tokenized assets. In August, its institutional services arm registered with the US Securities and Exchange Commission as a transfer agent, allowing it to maintain ownership records and facilitate securities transfers. Injective's native token has a market capitalization of roughly $887 million, according to CoinMarketCap data.

South Korea moves toward won-backed stablecoin regulation

South Korea is still debating who can issue won-backed stablecoins as lawmakers work through the Digital Asset Basic Act. The proposed law would establish a broader framework for digital assets, covering stablecoin issuance, disclosures, and market rules. How lawmakers settle the issuer question would define the parameters under which any won-backed token, including KRW1, could be minted and circulated.

A July policy report by Hashed Open Research and the Solana Policy Institute called for greater flexibility in stablecoin issuance and interim licensing guidance while the legislation is being developed.

South Korea's regulatory push follows the passage of the US GENIUS Act, which established a federal regulatory framework for payment stablecoins, and the European Union's Markets in Crypto-Assets Regulation (MiCA), which includes rules governing stablecoin issuers.

Industry data shows the stablecoin market remains overwhelmingly dollar-denominated, with US dollar-backed tokens accounting for more than 99% of the total supply. If it reaches the market, KRW1 would occupy the small non-dollar share of that landscape, and two near-term markers will shape its rollout: regulators' clearance of institutional minting and redemption, and the final terms of the Digital Asset Basic Act.