South Korea is moving closer to launching a regulatory framework for a won-backed stablecoin. According to local news outlet MoneyToday, the country’s Financial Services Commission (FSC) will introduce a government bill in October as part of the second phase of the Virtual Asset User Protection Act.
Representative Park Min-kyu of the Democratic Party of Korea (DPK) revealed during a policy debate that he had been briefed by the FSC on the policy direction. “The government bill is expected to be submitted to the National Assembly around October,” Park said.
Framework for Stablecoin Issuance
The upcoming bill is expected to include requirements covering issuance, collateral management, and internal control systems for stablecoins. The FSC has been working on this framework since 2023 through its virtual asset committee, with the aim of setting clearer rules for crypto service providers in South Korea.
The push comes as the United States accelerates its own efforts on stablecoin regulation, leaving South Korea to catch up.
Political and Industry Support
Stablecoin regulation gained momentum after President Lee Jae-myung pledged support for a won-pegged stablecoin during his campaign. Since then, several lawmakers have submitted related proposals, including:
- The Digital Asset Basic Act by Representative Min Byung-deok (DPK)
- The Act on the Issuance and Circulation of Value-Stable Digital Assets by Representative Ahn Do-gul (Planning and Finance Committee)
- The Act on Payment Innovation Using Value-Pegged Digital Assets by Representative Kim Eun-hye (People Power Party)
Local industry stakeholders have also stressed the need for a won-pegged stablecoin to reduce reliance on dollar-based stablecoins.
Banks Working on a Won-Backed Token
In June, several major South Korean banks announced a joint effort to develop a won-pegged stablecoin. The project is aimed at protecting the Korean won against growing dollar dominance, with the token expected to launch between late 2025 and early 2026.Despite growing efforts in South Korea, dollar-based stablecoins remain dominant worldwide. Data from RWA.xyz showed that as of Sunday, the total market value for stablecoins was $266.7 billion, with dollar-pegged tokens making up 99.8% of that figure ($266.3 billion).
