The South Korean government and National Assembly are working on the second phase of digital asset legislation centered around the “Basic Act on Digital Assets.” A key proposal under this legislation is to restrict stablecoin issuance exclusively to consortiums where banks hold a 51 percent stake. This proposal has received strong support from the ruling Democratic Party’s special task force on digital assets. Previously, the Bank of Korea advocated for stablecoin issuance to be led solely by banks and confined within the banking system. However, some lawmakers have suggested allowing fintech and blockchain companies to participate as well. The government plans to present the draft bill by December 10, with discussions to begin by the end of the year and legislation expected to be finalized by January. Stablecoins are cryptocurrencies pegged to stable assets like the US dollar to minimize price volatility. Their importance is growing globally as they are considered less risky and more reliable than traditional cryptocurrencies. South Korea’s strategy aims to ensure financial stability while promoting transparency and trust in the cryptocurrency sector. If enacted, the law would strengthen banks’ control over stablecoin issuance, helping reduce financial risks. However, this move may limit market opportunities for fintech and blockchain firms, potentially prompting their response. South Korea’s approach stands out amid diverse global policies on stablecoins as a distinctive regulatory strategy.
Source: binance
