Korean Fintech Giant Toss Plans to Launch Layer 1? Delay in Digital Asset Basic Law Becomes a Key Variable

In April 2026, South Korean payments and banking giant Toss was reported to be considering developing its own blockchain network and issuing a native cryptocurrency. The fintech platform, which has more than 20 million users, after publishing its stablecoin strategy just one month earlier, then turned its attention to more foundational Layer 1 infrastructure. However, its final decision stalled— the problem was not technical feasibility, but that South Korea’s “Basic Act on Digital Assets” has yet to be implemented. This legislative standoff not only affects Toss’s public chain roadmap, but also reflects a broader industry question: with a regulatory vacuum persisting, how will traditional financial giants manage their Web3 transition?

Why Toss is moving from fintech to blockchain infrastructure

Toss’s push into the blockchain space is not accidental. In March 2026, Toss first publicly unveiled its “Money 3.0” strategy, proposing to center on programmable money and stablecoins, upgrading the existing platform into a borderless financial super app. Viva Republica, the company’s operator, clearly stated that it would advance both the issuance and distribution of stablecoins, and that network infrastructure would be a core element of this strategy. Only one month later, Toss was reported to be taking things a step further—planning to develop its own Layer 1 blockchain and issue a native cryptocurrency, launching direct competition with Layer 1 platforms such as Solana and Klaytn that have already dominated the South Korean market.

From a business-logic standpoint, Toss’s blockchain rollout shows a clear step-by-step progression: first, migrate payment infrastructure on-chain through stablecoins; then build a closed ecosystem via its own public chain; finally, smoothly onboard its 30 million existing users into Web3 services. This “expansion from the application layer down to the infrastructure layer” strategy is highly similar to the logic behind Stripe launching Tempo and Circle launching Arc—control, value capture, and compliance are the shared driving forces. The difference is that Toss’s decision point is firmly stuck outside the regulatory window.

Business decision deadlock amid delays to the digital assets basic law

Toss has been unable to make a final decision between Layer 1 and Layer 2 architecture, and the direct reason is that the legislative process for South Korea’s “Basic Act on Digital Assets” has been severely delayed. This comprehensive bill, dubbed by industry insiders as the “Second-Phase Virtual Asset Act,” aims to regulate key areas such as token issuance, stablecoins, and crypto ETFs. However, since the legislative agenda was launched in 2025, the bill has been postponed multiple times.

The key issues behind the legislative delay center on two points of contention: the eligibility requirements for the issuer of won stablecoins, and the cap on the shareholding percentage of major shareholders of crypto exchanges. South Korea’s central bank argues that stablecoins should be issued primarily by banks, while the industry calls for authorized entities— not only banks— to also have issuance资格. The cap on major shareholders’ holdings has been set at 15% to 20%, but the National Assembly research body has warned this could be unconstitutional, infringing on property rights and the right to conduct business. In addition, serious disagreements within the ruling party over key provisions have led the policy committee and the digital asset working group to draft their own bill drafts, further increasing the difficulty of moving forward.

In March 2026, the previously scheduled party-state consultation meeting was postponed indefinitely due to Middle East developments. Insiders from the ruling party acknowledged that passage of the bill within the year has become extremely difficult. Meanwhile, South Korea’s Financial Services Commission is advancing strengthened regulatory measures such as requiring crypto exchanges to verify assets every 5 minutes, further increasing compliance pressure on the industry. In such a misaligned scenario—legislation still not landing while regulation keeps ramping up—any major decision by Toss faces substantial legal uncertainty: whether token issuance will be compliant, whether operating a public chain would cross financial regulatory red lines, and whether cross-border capital flows would be restricted— none of these issues can be answered clearly.

Strategic stagnation and opportunity costs amid a regulatory vacuum

Toss’s decision dilemma is not unique. South Korea’s crypto market is undergoing a structural crisis marked by large-scale capital outflows. According to a report from South Korea’s Financial Services Commission, in the second half of 2025 around $60 billion worth of crypto was transferred to overseas exchanges, up 14% from the first half. South Korean investors are accelerating their migration to overseas platforms to avoid increasingly stringent local regulatory conditions. Against this backdrop, Toss’s blockchain strategy stalling carries costs on two levels: first, it cannot convert user traffic into ecosystem value through its own public chain; second, it may miss the first-mover advantage in the global fintech public chain race.

At the same time, issues within Toss’s own operations also add uncertainty to its blockchain plans. On March 10, 2026, the Toss Bank application experienced a foreign-exchange-rate display failure, triggering roughly $19.4 million in transaction volume, leading to an estimated loss of about $6.9 million. South Korea’s Financial Supervisory Service immediately launched an on-site investigation. During the sensitive period of preparing for a Nasdaq listing, this technical incident exposed weaknesses in infrastructure-level reliability. When a fintech company suffers a major vulnerability in its core payment system, the market’s trust in whether it can operate a complete public-chain infrastructure is inevitably tested.

Redefining the boundary between traditional finance and the crypto ecosystem

If Toss successfully launches a Layer 1 blockchain, it could have a profound impact on South Korea’s crypto industry landscape. With 20 million to 30 million users, it could mean a massive mainstream user base being systematically brought into a Web3 ecosystem. This “traffic as the entry point” model could completely rewrite South Korea’s crypto customer-acquisition logic—shifting from exchanges actively acquiring users to having financial application scenarios embedded directly in the experience.

However, the South Korean market is not Toss’s only competitor. Coupang Pay has begun legal preparations to issue stablecoins, Kakao is preparing a won stablecoin based on the Kaia blockchain, and major financial institutions such as KB Kookmin Bank, Shinhan Bank, and Hana Bank have also started stablecoin settlement pilots. Globally, issuers Circle and Tether have also applied for South Korean trademarks, waiting for legislation to land before entering. In a game where multiple parties are competing, Toss’s competitive advantage lies in its full-stack financial licenses and user scale—but if legislation continues to be delayed, first movers could be overtaken by latecomers.

Future scenarios: three possible directions for Toss’s public chain strategy

Based on the current legislative progress and industry dynamics, Toss’s blockchain strategy has three main evolution paths.

Path one: prioritize a Layer 1 mainnet, waiting for legislation to be finalized. If the “Basic Act on Digital Assets” is passed between the second half of 2026 and early 2027, Toss may choose to directly launch its Layer 1 public chain and native token, building a complete ecosystem closed loop. This path enables the highest degree of vertical integration and value capture, but has the highest time cost.

Path two: lead with Layer 2, then transition to Layer 1. Under current regulatory uncertainty, Toss may prioritize launching Layer 2 solutions first, leveraging the security and liquidity of existing mainnets such as Ethereum to reduce compliance risk. Once legislation is clear, it would migrate to its own Layer 1. This strategy is more cautious, but may face migration costs after being locked into a Layer 2 ecosystem.

Path three: stablecoin first, public chain plans shelved or outsourced. If the legislative process continues to drag into after 2027, Toss may concentrate resources on stablecoin business and Web3 wallet development, temporarily postponing the development of its own public chain. The company previously applied for dozens of stablecoin-related trademarks and is developing a Web3 wallet integrated deeply with mobile platforms. This approach is the most pragmatic, but it has weaker long-term ecosystem control.

Risk warning: the cascading effects of prolonged legislative delays

The long delay of the Digital Assets Basic Act is generating multi-layered negative effects on South Korea’s crypto industry.

First is the acceleration of capital outflows. Large volumes of crypto assets held by South Korean investors continue to move abroad, weakening the liquidity and profitability of local exchanges. Second is stifled corporate innovation. The industry generally believes that legislative gaps prevent financial firms and tech giants from entering the market, causing growth to stall. Third is a weakening of international competitiveness. The United States approved spot Bitcoin ETFs in January 2024, the EU’s MiCA regulation took full effect in December 2024, while South Korea’s second-phase legislation continues to stall in place.

For Toss, the risks from legislative delay are particularly pronounced. If the final bill sets excessively high entry thresholds for stablecoin issuance, or maintains strict restrictions on the separation principle between financial and crypto businesses, Toss’s own public chain plan could face fundamental compliance barriers. In addition, if a cap on major exchange shareholders’ holdings is written into the final bill, it could have far-reaching effects on Toss’s future capital operations and equity structure. Even more worth worrying about is that overlapping geopolitical factors and domestic election cycles may further reduce legislative priority.

Summary

Toss’s plan to launch a Layer 1 blockchain and a native cryptocurrency is both a major fintech player’s bet on Web3’s future and a typical snapshot of South Korea’s predicament where digital asset legislation is missing. When technical roadmaps are forced to pause due to regulatory uncertainty, and when massive user traffic cannot be converted into ecosystem value due to compliance gaps, the industry’s fundamental question is: can South Korea hold its position in the global crypto landscape amid the ongoing tension between delayed legislation and market innovation? Toss’s final choice—whether Layer 1, Layer 2, or stablecoin-first—will become a key yardstick for measuring the intensity of this pressure.

FAQ

Q: Is the native cryptocurrency Toss plans to launch Layer 1 or Layer 2?

At present, Toss has not made a final decision. The company is considering issuing a native token based on the Layer 1 mainnet, while also evaluating Layer 2 expansion solutions. The final architecture choice will be influenced by the legislative progress of South Korea’s “Basic Act on Digital Assets.”

Q: Why has the “Basic Act on Digital Assets” been delayed without passing for so long?

The legislative delay is mainly due to two major disputes: the eligibility requirements for the issuer of won stablecoins, and the setting of the cap on major shareholders’ holding percentages at crypto exchanges. In addition, disagreements within the ruling party over key provisions, as well as geopolitical factors and domestic elections, have also affected legislative prioritization.

Q: What blockchain plans does Toss currently have?

Toss first publicly disclosed its stablecoin strategy in March 2026, planning to issue and distribute won stablecoins and advance into the “Money 3.0” era. The company previously applied for dozens of stablecoin-related trademarks and is developing a Web3 wallet integrated with mobile platforms.

Q: What does Toss issuing tokens mean for South Korea’s crypto industry?

Toss has more than 20 million users, and its entry into the blockchain space could become a key entry point for mainstream adoption of crypto in South Korea. This move is expected to bring large numbers of mainstream users into the Web3 ecosystem and set a precedent for other traditional financial institutions to enter the crypto space.

Q: If legislation continues to be delayed, what strategy might Toss take?

Toss may take one of three strategies: waiting for legislation to land and then directly launching a Layer 1 mainnet; prioritizing Layer 2 solutions to reduce compliance risk; or concentrating resources on stablecoin business and Web3 wallets, temporarily postponing public chain development. The specific path depends on changes in legislative progress and market conditions.