Kyobo Life Sets Up Digital-Asset Unit, Steps Up Blockchain Push

Kyobo Life Insurance has set up a dedicated digital-asset unit and started to flesh out related businesses, as it moves to get ahead of digital-asset legislation with blockchain-based initiatives including tokenized securities, or STOs, and real-world assets, or RWAs.

Kyobo Life told BloombergBit on May 12 that it created the dedicated department last month. The company has also been steadily hiring specialists in planning and development since the second half of last year, it said. A company official said the insurer is preparing in advance of digital-asset legislation and continuing to test various ideas.

The new organization also appears to reflect Kyobo Life Group Chairman Shin Chang-jae's push to expand into what he has internally called future finance. In the second half of last year, Shin told executives that the group needed new initiatives to broaden a structure still heavily weighted toward insurance, and that it should orient those efforts around blockchain-based businesses, according to the report.

The new unit will oversee the Kyobo group's mid- to long-term digital-asset roadmap. Job postings by Kyobo Life in the first half of this year show the company is planning businesses centered on stablecoins, STOs and Web3.

Specifically, the insurer is reviewing the establishment of an overseas subsidiary focused on digital assets, as well as cross-border payments and the use of stablecoins. It is also designing its own blockchain-based digital-asset wallet, remittance and custody services, while developing an RWA platform.

Kyobo Life is also expanding cooperation with global blockchain companies. Last month, it reviewed the status of a testnet tied to a project with Ripple to verify technology for trading government bonds using blockchain infrastructure. The project tests a structure in which real-world financial assets such as government bonds are converted into digital tokens and traded on a blockchain.

In December, Kyobo Life became the only South Korean insurer to participate in the public testnet of Arc, a network developed by Circle, the issuer of the USDC stablecoin. It has also joined the KDX Consortium, an alliance for an over-the-counter STO exchange led by Korea Exchange and Koscom, as a major shareholder.

The digital-asset industry is closely watching the insurer's moves because Kyobo Life manages a large pool of capital. The entry of a major life insurer could accelerate the expansion of the digital-asset ecosystem and its incorporation into the regulated financial system. Kyobo Life's assets under management stood at about 128 trillion won, or about $92.8 billion, as of last year.

One industry official said the life insurance sector has generally been relatively conservative in adopting new technology. Still, Kyobo Life's large asset base means interest is likely to grow over the medium to long term in alternative investments using digital assets and in developing new products.