KBank, South Korea's prominent digital-only bank and exclusive banking partner for the crypto exchange Upbit, is collaborating with Ripple to trial on-chain cross-border remittances. Following the successful completion of the first phase of a proof-of-concept using a wallet-based remittance system, the two companies are now in the second phase, testing the stability of on-chain transfers to countries such as the United Arab Emirates and Thailand. By utilizing Ripple's Palisade wallet, acquired as part of Ripple's $4 billion investment in crypto-related ventures, KBank aims to enhance the speed, cost, and transparency of its remittance services. Traditional international bank transfers often rely on correspondent banking networks like SWIFT, which can take days to settle and incur multiple fees.
In contrast, on-chain remittances enable direct fund transfers across a blockchain network, settling in minutes with fees paid only to the network. This partnership seeks to determine whether KBank can leverage this approach to improve its remittance services.
Additionally, KBank is preparing for impending stablecoin regulations in Korea, with plans to continue technical verification of remittance use cases for stablecoins as the regulatory framework evolves. Korean regulations mandate that all crypto exchange users link a verified bank account before trading, with each major exchange exclusively paired with one bank.
KBank holds this monopoly position with Upbit, the country's largest crypto exchange, which has contributed to its user base growth from approximately 2 million in 2020 to 15 million by the end of 2025. As South Korean lawmakers finalize the Digital Asset Basic Act, a comprehensive crypto regulatory framework, major financial institutions in Korea are signing infrastructure deals with global blockchain companies.
With Korea being one of the most active retail crypto markets globally, banks operating in this market are positioning themselves to handle the anticipated corporate and cross-border activity once the Digital Asset Basic Act formalizes the treatment of stablecoins, custody, and tokenized assets under Korean law.