BOK Union: "Stablecoins Are a 'New Type of Unregistered Deposit Business'...Possible Risk of Coin Run"

The labor union of the Bank of Korea has expressed a critical stance on the introduction of KRW stablecoins.

According to industry sources on the 28th, Kang Young-dae, chairman of the BOK union, stated in a declaration, "Stablecoins, which are merely a 'new type of unregistered deposit business', claim to be safe assets and attempt to gather funds without interest. There appears to be an intention to profit from deposit interest by raising interest-free funds under the pretense of convenience in overseas remittances, which also presents the risk of illegal foreign currency outflow," he criticized.

Chairman Kang pointed out that risks such as coin runs due to trust issues could arise. He added, "By nature, stablecoins are exposed to the issuer's IT risks and may experience coin runs due to market, credit, and operational risks. There is also a high possibility of shocks to our economy, such as a government bond sell-off and consumer losses."

He also emphasized the need for prior consultation to prevent such incidents. He stated, "The financial industry is a sector that must be regulated by the state. The stablecoin business should be subject to the same operations and regulations as existing related industries," and added, "Sufficient consultation and agreement should be reached in advance with financial stability institutions, including the Bank of Korea."