With the firm purpose of shielding its financial ecosystem, the Democratic Party of South Korea finalized the details of a regulation that will transform stablecoin regulations in Korea. During a plenary session held this January 28, lawmakers agreed that any issuing entity must maintain a minimum capital of 5 billion won, equivalent to approximately 3.5 million U.S. dollars.
This measure, promoted by the Digital Asset Task Force under the direction of Lee Jeong-moon, seeks to equate issuers of stable assets with traditional electronic money firms. In this way, the government intends to prevent the proliferation of insolvent projects that lack the necessary backing to respond to their users, thus strengthening confidence in the local market.
According to the provisions of the so-called “Digital Asset Basic Law,” the proposal will be submitted for formal debate before the Lunar New Year festivities in February. However, Secretary Ahn Do-geol emphasized that this capital structure is only the first preventive step to integrate these digital tools into the conventional payment system of the Asian nation.
Ministerial oversight and new compliance standards for digital issuers
In addition to financial requirements, the bill proposes the creation of a Virtual Asset Committee, which will be led by the Financial Services Commission. Likewise, the participation of the Bank of Korea and the Ministry of Economy will be fundamental to coordinate rapid responses to potential systemic failures or security incidents that could compromise national economic stability.
On the other hand, the implementation of these stablecoin regulations in Korea coincides with the lifting of a nine-year ban that prevented corporate investment in crypto assets. However, listed companies will now be able to allocate up to 5% of their equity capital to major cryptocurrencies, as long as they comply with the new standards of transparency and operational risk management.
Will private issuers be able to overcome the Bank of Korea’s resistance regarding capital controls?
However, the Governor of the Bank of Korea, Lee Chang-yong, has expressed concern about the risk of these assets facilitating cross-border capital flight. Because dollar-linked stablecoins are gaining ground, authorities fear that the South Korean won could lose monetary sovereignty if strict controls are not established over digital currency flows during periods of high volatility.
Despite these warnings, the South Korean tech industry envisions a horizon of innovation that could position the country as a global benchmark in the adoption of blockchain technology. Therefore, it is expected that the outcome of the February deliberations will define the final course of the industry, setting a precedent on how to balance financial security with the evolution of the digital market.
