Frax and IQ Introduce Korean Won-Pegged Stablecoin KRWQ on Base Blockchain

Decentralized Finance (DeFi) protocol Frax and AI platform IQ have launched a new Korean won-pegged stablecoin called KRWQ. The two companies joined hands to launch the stablecoin on Base blockchain, which is an affiliate platform of Coinbase. It is the first fully-backed won-pegged stable coin on Base and has been introduced with a KRWQ/USDC trading pair on the Aerodrome exchange as well.

According to the statement released on Cointelegraph, the KRWQ stablecoin is designed to operate as a multichain stablecoin that will enable transfers across several blockchain networks. It will be integrated with Stargate Finance and LayerZero protocols as well. This integration will allow for enhanced cross-network liquidity and accessibility for global users.

The introduction of KRWQ aligns with South Korea’s growing focus on stablecoin innovation. The Bank of Korea (BOK) has recently emphasized that local banks should play a leading role in stablecoin deployment. However, the move has sparked debate in the crypto industry. Dr. Sangmin Seo, chair of the Kaia DLT Foundation, urged regulators to provide clear frameworks for stablecoin issuers to “minimize monetary risks and foster innovation.”

IQ co-founder Navin Vethanayagam highlighted KRWQ’s market relevance, stating, “While USD-backed stablecoins dominate, no credible won-denominated stablecoin has ever launched at scale. KRWQ fills a critical gap in the market.”

Frax and IQ also emphasized that KRWQ is fully regulatory-compliant and developed “in anticipation of forthcoming stablecoin legislation” under review by South Korea’s national legislature. Nevertheless, the stablecoin is not currently offered to South Korean residents due to ongoing legal deliberations and is instead targeted toward global DeFi markets.

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Only verified and KYC-approved entities, including exchanges, institutional investors, and market makers, will be eligible for minting or redeeming KRWQ.

The launch comes amid rising competition in the stablecoin space. Just a day earlier, South Korean crypto custodian BDACS announced plans to issue its own won-backed token, KRW1, on Circle Internet Group’s Arc blockchain, following a successful pilot on Avalanche with Woori Bank.

KRWQ’s debut marks a crucial step in broadening the digital representation of national currencies and could signal the start of a new phase in Asia’s stablecoin evolution.

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