South Korea Stablecoin: Why a Crucial Bond Absence Hinders Progress

Key Points

1. Short-term government bonds are essential for stablecoin reserves due to their high stability and liquidity, but South Korea currently lacks these bonds.

2. Kim Pil-kyu, a senior research fellow at KCMI, emphasized the need for short-term bonds to issue a reliable won-denominated stablecoin.

3. Regulatory changes are required to create a comprehensive legal framework for stablecoin issuance and circulation in South Korea.

4. The absence of short-term bonds and regulatory clarity hinders South Korea's progress in the global stablecoin market.

5. Developing a robust digital won ecosystem requires addressing these challenges to ensure market integrity and investor protection.