South Korean payment processor BC Card has completed a pilot project that allowed foreign visitors to make payments using stablecoins at local merchants. The pilot marks a significant step in the country’s exploration of blockchain-based payments that operate within existing financial infrastructure, while maintaining compliance with South Korea’s strict regulations on cryptocurrency use.
The test
program, conducted in late 2025, allowed users to load stablecoins into a
digital prepaid card account. The value was automatically converted into South
Korean won at the time of purchase, enabling standard card transactions at
participating merchants. Merchants received settlements in the local currency
through BC Card’s network, meaning they did not handle cryptocurrency directly.
Background and Regulatory Context
South Korea has
been tightening and refining its oversight of digital assets since the collapse
of several global crypto exchanges and stablecoin projects in 2022. The
Financial Services Commission (FSC) and the Bank of Korea have spent the past
two years developing a unified regulatory framework that defines the role and
permissible uses of stablecoins.
Under current
regulations, cryptocurrencies are not recognized as legal tender and cannot be
used directly for payments within the domestic economy. This restriction has driven
financial institutions and fintech companies to explore hybrid models that
bridge blockchain technology with established financial systems.
The BC Card
pilot falls within this hybrid approach. It used stablecoins as a funding
mechanism for prepaid digital cards, which then processed payments through the
company’s existing infrastructure. The model allowed compliance with existing
rules while testing the practicality of using blockchain assets for
cross-border consumer spending.
Details of the Pilot
The pilot
focused specifically on foreign visitors in South Korea, a segment that
frequently faces friction with local payment systems. Participants could top up
digital cards using selected stablecoins, such as those pegged to the U.S.
dollar, through approved exchange partners. The system then issued the user a
virtual or physical prepaid card that could be used at merchants across South
Korea.
BC Card did not
specify which stablecoins were used in the test phase, but industry observers
suggest that well-established tokens like USDT or USDC were likely part of the
program. Transactions were processed in won through BC Card’s settlement
network, ensuring merchants faced no foreign exchange risk or crypto volatility
exposure.
The pilot ran
for several months before concluding successfully in December 2025. The company
reported no significant transaction failures or compliance breaches,
demonstrating that stablecoin-funded payment systems can operate within
existing financial and legal frameworks.
Market Implications
The success of
BC Card’s experiment illustrates a potential pathway for integrating stablecoin
technology into global payment systems. For foreign visitors, the system could
eliminate the need for currency exchange, reduce transaction fees, and speed up
settlement times.
For merchants,
the system provided access to international spending without any need to modify
point-of-sale systems or accept cryptocurrencies directly. Instead, the
conversion process happened at the network level, with BC Card acting as an
intermediary that maintained compliance with both domestic regulations and
anti-money-laundering standards.
If adopted more
widely, this model could influence how other countries and payment providers
handle cross-border transactions. Similar hybrid payment concepts are being
explored in Japan, Singapore, and Hong Kong, where regulators are seeking to
balance innovation with risk management.
Industry Perspectives
Industry
analysts view BC Card’s pilot as a practical example of how digital
asset-backed payments can coexist with traditional financial networks. It
demonstrates that stablecoins can be used for consumer payments without
undermining monetary sovereignty or bypassing domestic banking regulations.
The initiative
also aligns with South Korea’s growing role as a testing ground for
blockchain-based financial technologies. Major Korean firms, including banks
and telecom operators, have been piloting tokenized payments, blockchain
identity verification, and digital asset custody solutions over the past year.
Regulators,
however, remain cautious. The upcoming stablecoin legislation, expected to be
finalized in 2026, will determine the conditions under which payment providers
and financial institutions can use or issue stablecoins. Key aspects of the law
are likely to cover reserve management, issuance licenses, and transaction
reporting obligations.
What Happens Next
BC Card is
expected to review the pilot’s findings with regulators and industry partners
in early 2026. Depending on regulatory outcomes, the company may seek to expand
the service commercially to more foreign users or integrate it into broader
digital payment offerings.
The stablecoin
pilot’s completion positions South Korea as one of the few jurisdictions
testing crypto-backed payment systems under active regulatory supervision. It
also reinforces the global trend toward using blockchain infrastructure to
enhance efficiency in cross-border consumer payments without displacing
national currencies.
South Korea’s experience could inform how other
countries design digital asset payment systems, balancing innovation with
oversight. For now, the BC Card pilot provides a concrete demonstration that
stablecoin-powered payments can work seamlessly within regulated financial
ecosystems, offering a model that blends digital assets with compliance-first
finance.