Catenaa, Monday, November 17, 2025-South Korea’s NH NongHyup Bank has launched a pilot to digitize tax refunds for foreign tourists using stablecoins on the Avalanche blockchain, marking a key step in the country’s growing push toward blockchain-integrated finance.
The proof-of-concept, developed with Avalanche, Fireblocks, Mastercard, and Worldpay, aims to modernize the value-added tax refund process through smart contract automation and instant stablecoin settlements. It will test the system’s technical and operational feasibility without involving real customer data or funds.
Bank executives said the project could streamline the VAT refund process for millions of visitors reclaiming taxes on purchases taken abroad, replacing a slow, paper-based system with instant blockchain-powered transactions.
The test comes as South Korea seeks to expand its stablecoin framework, including a proposed regulatory system for won-pegged digital currencies designed to safeguard monetary sovereignty and reduce reliance on U.S. dollar-backed coins.
The government reported 16.37 million inbound tourists in 2024, up nearly 50% from the previous year, highlighting growing demand for faster and more transparent financial services for visitors.
The bank said it plans to develop its stablecoin-powered payment and refund solutions further, aligning with upcoming regulatory guidelines from financial authorities.
If successful, the project could position South Korea as a frontrunner in merging blockchain technology with real-world financial systems.
