South Korean payments provider NHN KCP has entered into a memorandum of understanding with Ava Labs to develop a payments-focused Layer 1 blockchain on the Avalanche network, marking a step toward integrating blockchain infrastructure into real-world payment systems.
The alliance centers on building a private mainnet tailored for commercial transactions, with a focus on speed, data security, and merchant-level customization. The project will leverage Ava Cloud, a service that enables enterprises to deploy and manage their own Layer 1 blockchains.
Payment Network Development
Under the agreement, NHN KCP and Ava Labs will work together to create a network designed specifically for payment use cases. The proposed system is expected to support sub-one-second payment authorization, alongside encrypted onchain transaction data. The infrastructure will also allow merchants to customize payment environments, forming part of a broader network designed to handle diverse commercial requirements.
The companies indicated that the initial phase will involve a proof of concept to assess the network’s technical feasibility. This stage is intended to validate performance and functionality before any broader rollout. In parallel, both parties plan to expand collaboration with financial institutions and payment firms as development progresses.
Jun Seok Park, CEO of NHN KCP, stated that the agreement combines the firm’s payment operations experience with blockchain infrastructure to establish a model applicable to commercial use. Meanwhile, Justin Kim, Head of Asia at Ava Labs, noted that the timeline for launching the Layer 1 network will depend on the outcome of pending cryptocurrency regulations in South Korea.
Broader Expansion Across Digital Payments
In addition to Layer 1 development, the partnership plans to explore digital commerce applications, including tokenized deposit systems, multi-stablecoin settlement frameworks, and cross-border payment solutions.
The move follows recent activity by Avalanche in South Korea. KB Kookmin Card, one of the country’s largest credit card providers, recently announced plans to develop a hybrid payment system using Avalanche infrastructure. The system aims to link traditional credit card services with digital wallets, enabling payments with both stablecoins and credit cards.
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