The coronavirus pandemic has slowed down trade in a huge swathe of industries, but some, such as the telecommunications sector – appear to be thriving, with blockchain sales rising for KT, one of South Korea’s biggest mobile carriers.
Per Newsian, KT’s operating profits rose by 2% in the past 12 months. The company, which along with rival SK dominates the South Korean mobile market, revealed select financial details to the South Korean media. It disclosed that while net profits increased by 5.6% in the same period last year, sales volumes were actually down by almost 2%, as internet and business-to-business sales fell.
But one of its business arms – blockchain technology – experienced rude health, growing sevenfold over the past year. The firm, which did not provide any other numbers, attributed its blockchain growth to the success of its local stablecoins projects. KT has become one of the nation’s biggest providers of blockchain-related technology to local governments in recent years, and operates tokens pegged 1:1 with the South Korean won in a number of major cities in the country.
Like the United States, Seoul has sought to revitalize flagging local economies hit hardest by the pandemic with payouts to households. But rather than take a centralized approach, in many cases the government has handed responsibility for the endeavor to local and city governments.
In addition, Seoul has prioritized contact-free payment solutions as a growth engine in the wake of the pandemic, a move that has driven many local governments to distribute funds to citizens in the form of local stablecoins, or expand the reach of existing stablecoin projects through additional token releases.
The project has proven so successful that the Korea Minting and Security Printing Corporation (KOMSCO), KT’s major rival in the stablecoin issuance sector, posted record profits last year as many local governments in the nation phase out paper-based gift certificates in favor of blockchain-powered smartphone apps and point-of-sale technology.