The government has decided to designate won-denominated stablecoins issued in quantities exceeding a certain level as "important coins" and pursue differential regulation.
According to financial sources on the 11th, the Democratic Party of Korea's Digital Asset Task Force (TF) held a closed-door meeting at the National Assembly that day and received a briefing from the Financial Services Commission (FSC) on the outline of the government's draft of the Phase 2 Virtual Asset Act, which includes these provisions. The FSC's final bill has not yet been officially submitted to the National Assembly, as it failed to narrow differences with the Bank of Korea.
The Financial Services Commission (FSC) reported today a plan to designate significant stablecoins based on the number of users and issuance volume. These designations will be made in consultation with the Bank of Korea (BOK). This designation reflects, to a certain extent, the BOK's concerns about the issuance of won-denominated stablecoins. A Democratic Party task force official explained, "This is modeled after the European Union's MiCA regulation," adding, "It reflects the BOK's concerns about the impact of stablecoins on monetary policy. It's more like a request for data submission than a form of control."
The legal name for the Korean Won stablecoin will be "Digital Payment Token (tentative name)." However, a Democratic Party official explained that this is not a finalized name but rather a temporary designation used during an internal review process, meaning it could change depending on future discussions. A plan has been reported to require stablecoins issued overseas, such as Tether (USDT) and USD Coin (USDC), to have domestic branches if they are circulated in Korea.
The Financial Services Commission is reportedly planning to finalize the government's proposal and report it to the Office of the President on the 19th after finalizing the remaining issues, including the issuer and supervisory authority. Once the government's proposal is finalized, the Democratic Party plans to hold a second meeting with private sector advisors on the 22nd to review the details. A Democratic Party task force advisory member stated, "Starting with the second meeting, advisors will also directly review the government's proposal, and subsequent discussions within the task force will continue."
The Democratic Party plans to finalize its coordination of opinions based on the government's proposal within this month and propose a bill in January of next year. Representative Lee Jeong-moon, chairman of the Digital Asset Task Force, stated, "The bill is already fully prepared, and once the government's proposal is submitted, we will conduct a combined review at the Political Affairs Committee level."
The Phase 2 Virtual Asset Act, which includes a regulatory framework for won-denominated stablecoins, has been delayed due to disagreements within the Bank of Korea, the government, and the ruling party over the requirements for issuance by bank-led consortia and the unanimous agreement of the policy council. The Bank of Korea has maintained that issuance should only be permitted to consortia with more than a 51% stake in commercial banks. Conversely, the Financial Services Commission and the ruling party maintain that non-banking sectors, such as fintechs, should be able to participate proactively. Kang Jun-hyun, a Democratic Party lawmaker and floor leader of the ruling party's Political Affairs Committee, emphasized, "It seems the National Assembly must now reach a conclusion. Coordination of opinions should be completed by December, and the bill should be proposed and reviewed starting in January."
- Reporters Kim Jeong-woo and Do Ye-ri
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