IT information services firm Hekto Innovation signed a memorandum of understanding with digital finance infrastructure company BEATOZ and will cooperate on a hybrid blockchain-based stablecoin business, it said on Aug. 13.

Through the cooperation, the companies plan to combine blockchain infrastructure and digital asset wallet technologies held by each side to work across stablecoin issuance, distribution and broader use.

The companies will launch a proof of concept to verify the full process from stablecoin issuance to distribution, payment, settlement and burning. Hekto Innovation will participate as a validator on the BEATOZ network. It will also work with BEATOZ to expand the supply of digital asset wallets to financial institutions, as part of cooperation in blockchain infrastructure.

The proof of concept covering the full process from stablecoin issuance to burning will be conducted using Hekto Group employee welfare points. Hekto Innovation plans to implement welfare points provided to Hekto Group employees as on-chain assets for testing purposes. It will verify the overall operating structure in a real-use environment in which stablecoins are issued, go through payment and settlement, and are then burned.

The proof of concept is not a method of issuing an actual won stablecoin or depositing reserves. Hekto Innovation plans to verify the full process of digital asset issuance, payment, settlement and burning in a limited environment. It also plans to secure stablecoin ecosystem use cases in which a wallet, payment and platform are connected. Hekto Innovation plans to sequentially expand on-chain use cases for group assets such as welfare points across various blockchain network environments.

The companies will also expand cooperation in blockchain infrastructure. Hekto Innovation will participate as a validator on the BEATOZ network and conduct a technical review of node operations and the transaction validity verification system. It will support the BEATOZ blockchain in Octet, a digital asset wallet developer tool for Hekto Wallet One. It will also explore supplying the VASP wallet Ohai Wallet to financial firms cooperating with BEATOZ.

A Hekto Innovation official said, "Through this proof of concept, we will internalise verification capabilities for the entire process from issuance to burning of stablecoins based on a hybrid blockchain." The official added, "With Hekto Innovation at the centre, we will bring the group's capabilities together and continue to secure stablecoin use cases."