NHN KCP, one of South Korea’s largest payment gateway providers, has launched a pilot project aimed at accelerating the commercialization of stablecoin payments as competition grows to build blockchain-based payment infrastructure.
The company announced today it is conducting a proof of concept with Payco, a mobile payment app that competes with Naver Pay and Kakao Pay, to test integrated online-to-offline stablecoin transactions using a blockchain network developed with Avalanche.
In internal tests involving around 700 employees, the system clocked approximately two seconds from QR code scan to payment approval.
How it works
Online, users can purchase and sell Payco gift certificates using stablecoins within the app they already know. Offline, the system was tested at a cafe and cafeteria inside NHN KCP’s headquarters.
The company also built what it described as the first “stablecoin payment admin page” for merchants, a dashboard where shop owners can track blockchain-based sales and settlement data in real time without needing to know anything about blockchain.
Why South Korea?
South Korea has become one of the world’s most cashless economies as consumers increasingly shift toward digital payment methods. Cash represented only around 16% of transactions in 2024, according to Statista.
Although the pandemic boosted cashless payment usage globally, South Korea had already established itself as a leader in digital finance before COVID-19.
NHN KCP processes payments for a large share of South Korean e-commerce. The firm said it will continue refining the system using pilot data and plans to share results with financial-industry partners and large merchants as commercialization discussions advance.
The pilot comes after NHN KCP and Ava Labs signed a memorandum of understanding (MOU) last month to develop a payment-focused layer 1 blockchain network built on Avalanche infrastructure as part of efforts to modernize digital payment systems in South Korea.
The partnership focuses on building a specialized blockchain infrastructure optimized for payment authorization, merchant settlement and financial-service applications. The network is designed to support sub-second transaction approvals, enabling near real-time payment authorization and settlement processing.
NHN KCP and Ava Labs also plan to integrate on-chain encryption technology that secures sensitive payment data, including transaction details and merchant settlement amounts, directly within the blockchain environment.