The Bank of Korea Governor, Lee Chang-yong, has initiated discussions on potential regulatory changes concerning Korean won-backed stablecoins. This move signals a significant step in advancing South Korea’s digital currency strategy.
The core objective is to bolster domestic digital asset frameworks by promoting the development and adoption of stablecoins pegged directly to the Korean won. This initiative specifically aims to reduce the current market dominance of USD-pegged stablecoins.
By fostering won-pegged alternatives, authorities seek to retain greater control over capital flows within the economy, thereby enhancing monetary sovereignty. President Lee Jae-myung underscored the importance of such stablecoins in mitigating capital outflows, potentially leading to increased market stability and liquidity.
The proposed regulatory framework intends to carefully balance fostering innovation in the digital asset space with robust risk management protocols. Ensuring compliance with established Anti-Money Laundering (AML) and Know Your Customer (KYC) standards remains a fundamental requirement.
The successful introduction of a regulated won-backed stablecoin is viewed as a potential catalyst. It could accelerate the broader adoption of blockchain technologies and digital payment solutions across South Korea.