"It’s been a while"… The first star of the ‘Lee Jae-myung rally’ is stirring again [Stock+]

Kakao Pay heads straight to the daily limit-up

"Rising expectations for legislation on digital assets"

Kakao Pay soared to the daily limit-up in the stock market on the 23rd on expectations that legislation for stablecoins will be put in place.

On the day, Kakao Pay closed at 67,800 won, up 15,600 won (29.89%) from the previous session. Along with Kakao Pay, Naver (8.15%), Kakao (4.28%), KakaoBank (9.11%), and LG CNS (9.56%) also jumped. On expectations tied to security tokens (STOs), Mirae Asset Securities and NH Investment & Securities also showed strength.

In the Kosdaq market, Hecto Financial (30.0%), NHN KCP (29.94%), Me2on (29.94%), Danal (29.93%), Cocon (26.8%), and ITCEN Global (19.4%) surged.

The rally in these companies is interpreted as stemming from renewed expectations for legislation of digital assets such as stablecoins and security tokens. It was reported that Rep. Min Byung-duk of the Democratic Party of Korea mentioned digital assets at a luncheon of the KOSPI 5000 Special Committee hosted by President Lee Jae-myung the previous day.

Rep. Min reportedly argued at the event that digital assets should be leveraged to push the Kosdaq above 3,000, citing the example of a won-denominated stablecoin. He is also said to have proposed that Kosdaq-listed companies could help energize the market if they make use of digital assets.

Stablecoin-related stocks were leaders that drove the so-called ‘Lee Jae-myung rally’ immediately after President Lee’s inauguration in June last year. Kakao Pay in particular saw its share price jump from the 20,000-won range before his inauguration to the 110,000-won range in just three weeks after, posting a 295% gain over the period.

Unlike other cryptoassets, stablecoins are digital assets that aim for price stability by pegging their value to specific assets such as the U.S. dollar, the euro, U.S. Treasuries, and gold, while also pursuing the convenience of cryptoasset payments. This contrasts with typical cryptocurrencies such as bitcoin, which lack fixed-asset backing and are highly volatile.

Security tokens are ‘securities’ under the Capital Markets Act that digitize real-world assets using distributed ledger technology. They make it possible to trade, like stocks, real assets such as real estate, artworks, and music copyrights—previously difficult to capture with conventional electronic securities—as well as non-standard assets and rights such as environmental, social and governance (ESG) interests and content intellectual property (IP).

Earlier, Rep. Min spearheaded the introduction of the ‘Basic Act on Digital Assets.’ The bill includes provisions to establish a presidentially affiliated Digital Assets Committee to strategically foster related industries at the national level and coordinate policy, and to legally permit the issuance of digital assets.

However, the legislative process has failed to gain momentum as coordination among relevant authorities, including over the direction of regulation, has been delayed. The Democratic Party reportedly held a Digital Assets Task Force (TF) meeting on the 20th and began work to craft a unified party proposal. The plan is to finalize its own bill promptly rather than wait for a government proposal, and to lead discussions in the National Assembly’s Political Affairs Committee.

According to the industry, the global market for tokenized digital securities is expected to expand to $5 trillion by 2030. Quinlan & Associates, a Hong Kong-based management consultancy, forecast that STOs will account for 42.9% of global securities trading value by 2030, growing to about $162.7 trillion.

Kim Ji-won, an analyst at KB Securities, said, "If STOs are legislated, we can expect fractional securities for a wide range of real assets—such as real estate, infrastructure, private credit, intellectual property and K-content—to be brought into the regulated market," adding, "If linked with tokenized payment instruments such as stablecoins and central bank digital currencies (CBDCs), transaction and capital efficiency could rise significantly, so it will be necessary to watch additional institutional reforms and the process of building out infrastructure."

Noh Jeong-dong, Hankyung.com reporter dong2@hankyung.com