South Korea is making headlines in the crypto world with a bold move to legalize stablecoins, positioning itself as a leader in digital asset regulation. The country’s ruling Democratic Party, under President Lee Jae-myung, has introduced the Digital Asset Basic Act—a comprehensive bill designed to allow domestic companies to issue stablecoins and establish a clear regulatory framework for their use .
What’s in the New Bill?
• The Digital Asset Basic Act will permit local firms to issue stablecoins, provided they have a minimum equity capital of 500 million won (about $368,000).
• Issuers must secure approval from the Financial Services Commission, South Korea’s main financial regulator, and maintain sufficient reserves to guarantee user refunds.
• The bill aims to enhance transparency, foster competition, and ensure that stablecoin operations are safe and reliable for users .
Why Is This Important?
Stablecoins are digital tokens pegged to stable assets like the Korean won or US dollar, offering a way to transact in crypto without the wild price swings of traditional cryptocurrencies. By legalizing and regulating stablecoins, South Korea hopes to:
• Prevent capital from flowing out of the country by supporting a won-backed stablecoin market.
• Provide a safer, more transparent environment for crypto users and investors.
• Encourage innovation and competition in the rapidly growing digital asset sector .
A Surge in Crypto Activity
Interest in stablecoins is booming in South Korea. According to the Bank of Korea, transactions involving major US dollar stablecoins reached approximately $42 billion on five major domestic exchanges in the first quarter of 2025 alone . With more than a third of the population—around 18 million people—actively participating in the crypto market, the new legislation is expected to further boost trading and adoption.
South Korea vs. the US: Who’s Leading the Crypto Race?
While the US continues to debate its own stablecoin regulations, with the GENIUS Act still facing delays in Congress, South Korea is moving quickly to implement clear rules. President Lee’s administration is not only focused on stablecoins but is also exploring other crypto-friendly policies, such as allowing the national pension fund to invest in Bitcoin and considering the launch of Bitcoin ETFs .
What’s Next?
If passed, the Digital Asset Basic Act will make South Korea one of the first major economies to fully legalize and regulate stablecoins. This proactive approach could give the country a significant edge in the global digital asset market, attracting both local and international investors and innovators.
