Busan Bank, AhnLab Blockchain complete proof-of-concept for digital local currency

K-STAR (KRW Stablecoin Tech Alliance for Revolution), a won-based stablecoin digital currency infrastructure alliance that includes AhnLab Blockchain Company — a subsidiary of cybersecurity firm AhnLab — announced Monday that it has completed a proof-of-concept (PoC) with BNK Busan Bank for blockchain-based payment and settlement infrastructure to support the digital transformation of local currencies.

The project brought together BNK Busan Bank, AhnLab Blockchain Company, OpenAsset, Kaia and Lambda256.

The participating companies focused on building what they call a "policy-type local currency" model — one that embeds policy conditions such as approved spending locations and expiration dates directly into the currency itself. Rather than simply issuing and transferring tokens, the project reproduced the full operational structure of a local currency — including top-ups, payments and settlement — within a blockchain environment.

BNK Busan Bank designed the policy-type local currency model based on its existing local currency operations and verified key functions including top-up, payment and settlement. AhnLab Blockchain Company handled overall project design and implemented the user wallet and transaction and settlement architecture.

OpenAsset managed stablecoin issuance and asset integrity, while Kaia provided the mainnet environment. Lambda256 supported node infrastructure operations and transaction flow monitoring.

The central achievement of the PoC was the implementation of "programmable money" — going beyond simple token transfers. By embedding predetermined conditions into the currency to control its payment purpose and scope of use at the system level, the project demonstrated the potential to expand into policy funds, digital vouchers, central bank digital currencies (CBDCs) and won-based stablecoin services.

The consortium also ran tests to assess the processing performance of the Kaia mainnet. Drawing on BNK Busan Bank's payment operations data, the team designed four transaction scenarios — normal, congested, peak and mixed irregular — and conducted a 24-hour continuous test.

The system recorded a 100 percent transaction success rate across all scenarios, with processing times under one second. The test also verified transaction costs, a fee-subsidy user experience model and a real-time monitoring and response framework.

"This project is significant in that it verified that a digital currency-based local currency service can operate stably in a real-world environment," said Lim Ju-young, head of AhnLab Blockchain Company. "Each participating company will build on its specialized capabilities to lay the groundwork for expanding not only the digital transformation of local currencies, but also into next-generation financial ecosystems encompassing stablecoins, digital assets and cross-border payment and settlement."

Meanwhile, AhnLab Blockchain Company recently obtained a virtual asset service provider (VASP) license. According to the Financial Intelligence Unit, as of June 30, a total of 28 companies — including AhnLab Blockchain Company — have been approved for VASP registration.