South Korea’s Parties Pledge to Fast-Track Digital Asset Law After Local Elections, Call Stablecoin Push Urgent

National Assembly Stablecoin Seminar

Rival parties say Digital Asset Basic Act should advance immediately after local elections

Tether says a won stablecoin could help link Korea with overseas capital

South Korea’s ruling and opposition parties called the domestic development of stablecoins an urgent priority and said they plan to move swiftly on a Digital Asset Basic Act after local elections.

Kim Sang-hoon of the ruling People Power Party made the remarks on May 12 at a seminar titled “Global Stablecoin Trends and Opportunities for Korea’s Digital Economy” held at the National Assembly Members’ Office Building in Seoul. He said some in the ruling party want the Digital Asset Basic Act placed on the legislative review agenda as soon as the local elections end. Even without a government bill, he said, the party would move quickly based on measures already introduced.

Lee Kang-il of the opposition Democratic Party said global interest is rising in digital assets and stablecoins as they intersect with the artificial intelligence industry and digital finance. He added that he would do his best to ensure the Digital Asset Basic Act passes this year.

The comments underscored the view that a won-denominated stablecoin should be launched quickly. Min Byung-dug of the Democratic Party said dollar-based stablecoins are becoming a new financial infrastructure that expands the influence of the U.S. currency in digital spaces. A won stablecoin would be more than a defensive tool, he said, describing it as an offensive instrument that could connect South Korea’s economy and industries more broadly in digital environments. He cited potential uses including ties to the K-content industry and models for regional commercial districts.

Global examples should guide stablecoin regulation

Industry officials from South Korea and abroad also attended the event and offered recommendations for the Digital Asset Basic Act.

Joshua Towns, global head of regulatory affairs at Digital Currency Governance Group, or DCGG, said major countries are moving quickly to establish stablecoin regulatory frameworks, but outcomes have varied depending on each jurisdiction’s approach. He cited the European Union’s Markets in Crypto-Assets framework, or MiCA, saying its strict licensing and regulatory regime prompted some companies and investment capital to leave the market.

He pointed instead to the U.K.’s tiered approach. Britain is calibrating regulatory intensity based on the risk level and use case of digital assets, Towns said. Regulation should reflect actual use cases and risks rather than broadly shutting down market activity.

Kim Tae-rim, managing partner at AXIS Law, made a similar argument. About 160 trillion won ($115.9 billion) in domestic funds moved to offshore exchanges last year, he said, and a won-based stablecoin known as KRWQ is already circulating offshore. Rather than adopting an EU-style one-size-fits-all regime, South Korea should look to the U.K.’s differentiated approach and manage digital assets and won-based stablecoins within the regulated system, he said.

Won stablecoins have strong potential

Global stablecoin companies also gave favorable assessments of the competitiveness of won-denominated stablecoins.

Giles Dixon, Tether’s global head of licensing and regulatory affairs, said South Korea has already created global demand in sectors including K-pop, cosmetics and technology. Stablecoins could help spread Korean products and cultural content more easily in global markets. For an export-driven economy such as South Korea, he added, stablecoins could provide an opportunity to connect global investment and payments.

Vincent Chok, chief executive officer of First Digital, the Hong Kong-based issuer of the dollar stablecoin FDUSD, said dollar-based stablecoins will likely retain market dominance for the time being. Still, a won stablecoin could serve as a bridge between global investors and the South Korean market, he said. Given the strength of Korean culture and content, it has ample room to expand globally. As AI-based payments and the digital economy grow, Chok added, stablecoins linked to a broader range of currencies will be needed, creating a substantial opportunity for won stablecoins.