Kaia Blockchain: A New Benchmark for Korean Stablecoins

Recently, the Kaia public chain has become one of the focal points in the crypto market due to its strong token performance. Since its launch in August 2024, Kaia has been committed to enhancing technical performance and expanding its ecosystem. Recently, its initiatives in the stablecoin and payment fields have sparked widespread discussion among industry investors. Senior officials from the foundation stated, "The era of Kaia's stablecoin is about to arrive," hinting that its fiat-backed token plan is soon to be implemented.

With the new government in South Korea taking office, supporting the issuance of stablecoins pegged to the Korean won has become a new policy direction. The Kaia team announced that it will cooperate with several super apps to launch a Korean won stablecoin. This news quickly triggered market reactions, with related company stock prices rising sharply, and the price of the Kaia token climbing from nearly $0.10 to a peak of $0.17, reflecting the market's optimistic expectations for local stablecoin projects in South Korea.

Stablecoin Projects Under Policy Dividends

After the new South Korean government proposed a policy to support the domestic stablecoin in 2025, Kaia quickly responded and announced a plan for the Korean won stablecoin. This news boosted the stock prices of related concept stocks, and the market showed a strong interest in the Korean won stablecoin.

Kaia's Korean won stablecoin project is being promoted by several well-known tech companies and is currently still in the planning stage, with a specific issuance timetable yet to be determined. With its digital wallet infrastructure and payment systems, the relevant companies are seen as potential beneficiaries of the local stablecoin.

Currently, the South Korean government is formulating the "Basic Law on Digital Assets" and actively discussing a regulatory framework that allows private institutions to issue stablecoins. The bill aims to relax the rules for cryptocurrency exchanges, allowing non-bank institutions and payment service providers to issue stablecoins. According to this framework, the approval authority for stablecoin issuers will be under the Financial Services Commission. The bill also significantly lowers the regulatory threshold, reducing the capital requirement for issuers from 5 billion KRW to 500 million KRW.

However, according to the South Korean Constitution, the right to issue legal currency belongs to the central bank, and private institutions face legal obstacles in issuing fiat-backed tokens. The Bank of Korea has expressed concerns about these proposals, arguing that indiscriminate issuance of stablecoins denominated in Korean won could lead to "currency runs" and affect the competitiveness of the won.

In terms of policy inclination, the head of the Digital Assets Committee of the ruling party in South Korea stated that they will support private issuance and plan to clarify the legalization of stablecoin in the "Basic Law." The technology group behind Kaia has a large-scale payment and financial infrastructure, which facilitates the practical use of stablecoins in the future.

Despite the enthusiastic market response, the outlook for the Kaia stablecoin project remains uncertain. Issues of currency sovereignty and anti-money laundering compliance still need to be addressed, and the issuance and redemption mechanisms of the stablecoin are yet to be validated. In addition, several potential competitors are also targeting this market. During the recent tokenized deposit and central bank digital currency experiments conducted by the Bank of Korea, several large banks announced plans for a joint issuance of stablecoins.

Therefore, although Kaia's stablecoin project has generated much anticipation, it still faces many challenges in obtaining regulatory approval and being successfully implemented.

Social Giant Alliance, Huge User Base

Kaia public chain is a large blockchain network primarily aimed at the Asian region, formed by the merger of blockchain projects with backgrounds from two major social platforms in South Korea and Japan, officially launched in August 2024. Its goal is to seamlessly integrate with mainstream social applications to bring Web3 services to hundreds of millions of Asian users.

These two major social platforms hold significant market shares and user bases in their respective countries. One of them has nearly a 95% penetration rate in South Korea, with around 50 million monthly active users; the other, as Japan's most popular messaging platform, reaches 70% of the population in Japan and dominates markets in Thailand and Taiwan. Based on the distribution capability of over 250 million users across the two platforms, Kaia has been regarded as one of the potential stocks to promote the adoption of crypto applications. This year, the Kaia Foundation has raised funds from several well-known investment institutions to support ecological incubation and market promotion.

Before the merger, the two blockchain projects achieved significant results in their respective fields. One project was an important representative of the Korean blockchain network, with its user base experiencing a 1,100% growth in 2023, reaching 873,000; the other project was launched in 2022 and provided NFT services on its social platform, accumulating over 5.6 million users and completing approximately 560,000 NFT transactions. After the merger, Kaia inherited the ecosystems and application scenarios of both projects to achieve complementary technology and users.

As an Ethereum-compatible Layer 1 public chain, Kaia technically adopts an optimized consensus framework. Its consensus algorithm is based on an improved Byzantine Fault Tolerance mechanism, which allows for rapid final confirmation of blocks and supports multi-node participation. According to the official documentation, the Kaia network can handle up to 4000 transactions per second, with a block generation time of only 1 second and immediate transaction finality. Unlike traditional PoW/PoS, Kaia employs a consensus mechanism oriented towards enterprise and service scenarios, ensuring that once a block is generated, it is definitively confirmed, eliminating the traditional risk of block rollback.

Kaia network nodes are divided into three categories: consensus nodes responsible for block generation and verification, proxy nodes, and endpoint nodes. The network design ensures that over 50 nodes can participate in consensus, striking a balance between throughput and decentralization.

In terms of technical features, Kaia supports account abstraction and fee delegation functions, greatly simplifying the user experience; it also integrates identity and payment channels from two major social platforms, allowing ordinary users to access on-chain services without additional registration. Kaia maintains compatibility with EVM chains like Ethereum and plans to support CosmWasm smart contracts; with industry-leading cross-chain bridge integration capabilities, it provides developers with flexible multi-chain interoperability.

Expansion from Gaming to Financial Services

At the early stage of its launch, Kaia's user base and capital scale were in their infancy. By mid-2025, Kaia ranked approximately among the top fifty globally in terms of Total Value Locked (TVL) in DeFi, reflecting that its ecosystem is in the early stages of development. In terms of on-chain activity, Kaia's official disclosure indicates that over 40 million users have accessed its Mini DApp portal. The number of wallets and trading volume rapidly increased during the initial launch phase, but the overall levels still lag behind mature mainstream public chains such as Ethereum, Solana, and BNB.

In terms of the ecosystem, Kaia integrates the application ecosystems of two existing projects, forming a comprehensive ecosystem covering multiple fields such as DeFi, NFT, GameFi, and Real-World Assets (RWA). According to official statistics, after the merger, there are already over 420 decentralized applications and game services that have been or are planned to be launched on the Kaia network.

In addition, alongside the launch of the Kaia mainnet, a builder support program called Kaia Wave has been introduced. This program aims to provide comprehensive support to promising Dapps, enabling them to reach users in both Web2 and Web3, and gain additional advantages from channels such as social platforms, Web3 marketing alliances, creators, and Kaia's vertical services. According to official documents, the Kaia Wave program will offer KAIA tokens valued at a total of $10 million, specifically for user acquisition and rewards.

In the DeFi space, Kaia has launched multiple decentralized exchanges as well as staking and lending projects. The platform also supports stablecoins, cross-chain bridges, and other infrastructure. In terms of NFTs, Kaia has inherited the user base of the original NFT platform. Its GameFi ecosystem benefits from the user groups and partner resources of two major social platforms, and some game developers have begun to launch mobile games, NFT items, and other content on Kaia.

Following the trend of integrating well-known instant messaging applications with blockchain, the Dapp Portal is one of the main tools for the development of the Kaia ecosystem. The Dapp Portal is built on the Kaia chain and is accessible to users through the official accounts of social applications, allowing access to games, social interactions, trading, and other Mini DApps within the chat interface without the need to download or install any new applications. In January of this year, Kaia jointly launched the first batch of 32 Mini DApps, enabling users to create wallets, play games, claim rewards, and trade NFTs with just one click, without the need to install a separate client.

In its official strategy, Kaia is gradually expanding from the gaming sector to financial services and general applications: by early 2025, it has launched a US dollar stablecoin yield product on social platforms, with future plans including the introduction of lending, perpetual contracts, payment, and asset tokenization DeFi protocols, as well as achieving seamless exchange functionality between the Korean won and stablecoins.

In May of this year, a well-known stablecoin issuance institution officially deployed its US dollar stablecoin on Kaia, providing stablecoin payment and cross-border remittance services to nearly 200 million users, marking a further expansion of Kaia's layout in the international stablecoin ecosystem. Overall, Kaia is accelerating the construction of a platform-level ecosystem, promoting use cases of "message as entry, on-chain as payment" in collaboration with industry partners.