Uk Jin

Paul Krugman, who was awarded the Nobel Prize in Economic Sciences in 2008, expressed rather negative views on stablecoins (virtual assets pegged to the value of fiat currencies). According to CryptoSlate, a media outlet specializing in digital assets (cryptocurrencies), on the 2nd (Korea time), Krugman pointed out in his blog, "Unlike debit cards or remittances, stablecoins cannot be used for ordinary purchases," and stated, "Stablecoins clearly do not provide any useful function." Krugman emphasized that the only advantage stablecoins have over other payment methods is anonymity. He stated, "The anonymity related to stablecoin deposits is valuable to criminals seeking to commit crimes such as money laundering, extortion, or illegal drug purchases," and added, "The sole economic purpose of stablecoins is to facilitate criminal activity." Meanwhile, Krugman also criticized the stablecoin bill being promoted in the US. He said, "The lawmakers supporting the US stablecoin bill known as the Genius Act are vested interests," and criticized, "Some are aware of the potential abuse of stablecoins but still agree to it, while others lack understanding, making it difficult to explain it to others." The industry immediately responded. Nick Carter, co-founder of Coin Metrics, emphasized, "Krugman has extremely wrong information," adding, "Stablecoins are already being used by over 100 million people."

According to the industry on the 2nd, Changyong Rhee, the Governor of the Bank of Korea, stated at the '2025 BOK International Conference' held at the Bank of Korea Annex in Jung-gu, Seoul, during a conversation with Christopher Waller, a member of the Board of Governors of the Federal Reserve System (Fed), that the possibility of regulatory arbitrage, among other factors, must be carefully considered before allowing KRW-denominated stablecoins for non-banking sectors. Governor Rhee said, "We need to think carefully about whether to allow stablecoins denominated in KRW only to banks or also to non-bank institutions," adding, "We must consider financial stability from multiple perspectives." He further explained, "Unlike the United States, our country has capital regulations. Before allowing non-bank institutions to enter the payments business, we need to consider whether (KRW-denominated stablecoins) will move in a direction that circumvents or weakens capital regulations." He added, "Korea takes a more cautious stance on stablecoins than the United States," and said, "We place a strong emphasis on capital regulations, and other Asian countries feel similarly." Christopher Waller described stablecoins as "a type of payment tool that non-bank institutions can provide." He said, "The United States has relatively high payment fees, so from the perspective of lowering fees through the private sector, it may be favorable," adding, "Banks may not like it, but if a fair opportunity is provided, it could be acceptable." That day, there was also discussion about the Central Bank Digital Currency (CBDC) initiative. Waller commented, "Globally, the pace of CBDC-related discussions has slowed down." Regarding Project Agora, which is pursued by the Bank for International Settlements (BIS), Bank of Korea, the central banks of the United States, United Kingdom, Japan, France, Switzerland, Mexico, and the Institute of International Finance (IIF), he evaluated it as "a project to establish an international payment and settlement system platform." He explained, "Within the payment system, steps such as customer identification (KYC) and anti-money laundering cause remittances to take a long time and incur costs, so the goal is to create a unified platform to integrate these." Meanwhile, in his keynote speech, Waller described the inflation increase caused by US tariffs as temporary. He said, "Although the tariff level is uncertain, we currently estimate the effective tariff rate at about 15%," but emphasized, "The effects of tariffs will be most evident in the second half of the year, though the impact on inflation will be temporary." He continued, "Some are concerned that the surge in inflation after COVID-19 in 2021–2022 lasted longer than expected, but at that time there were factors such as labor supply shocks, supply chain disruptions, and fiscal policies for economic stimulus," adding, "Currently, these three factors are absent regarding tariffs." He also said, "If the effective tariff rate drops to the low-tariff scenario, and core inflation converges toward the 2% target while the labor market remains solid, then we would support a rate cut in the later part of this year as a result of 'good news'."

According to Walter Bloomberg on the 2nd (KST), Christopher Waller, a member of the Federal Reserve (Fed), stated that "Stablecoins are merely a means of payment," but also said that they are "a way to introduce competition into the payments sector."

On the 2nd (KST), Elon Musk, CEO of Tesla, introduced a new feature within X (formerly Twitter) called ‘XChat’ via X. Musk explained that XChat offers encryption, message expiration, as well as the ability to transfer all types of files, adding, “In particular, audio and video calls are based on Rust, using Bitcoin-style encryption.”

"We can't win even if we unite… Give your support to the crescent moon" Lee Jun-seok, the presidential candidate of the Reform New Party, appealed to conservatives on the 2nd, urging them to choose him rather than Kim Moon-soo, the People Power Party's presidential candidate, in the main election. He argued that the outcome of this election is already decided, and that conservatives should empower him for the future of conservative parties. On Facebook that day, Lee stated, "According to detailed research and data analysis, Candidate Kim has already clearly lost. Regardless of whether there is a single conservative candidate or not, I tell you there is no way to win by any means," and continued, "Looking at the two candidates who declared support for Candidate Kim and then withdrew: one is the Liberty Unification Party candidate who adamantly opposed the impeachment of Yoon Suk-yeol, and the other is Candidate Hwang Kyo-ahn, who became entangled in conspiracy theories about a rigged election." Lee argued, "A vote for this awkward alliance is a wasted vote that kills democracy twice. I, Lee Jun-seok, cannot be with such forces, which is why, despite many wounds, I have fought more fiercely than anyone in a head-on battle with Candidate Lee Jae-myung," and continued, "The time for choice has come. Please send overwhelming support not to the setting full moon, but to the rising crescent. Persuade those around you to vote for No. 4, Lee Jun-seok." He reiterated, "Candidate Kim has already lost the presidential election. Any vote for him is a vote to exonerate and benefit Yoon Suk-yeol, Jeon Kwang-hoon, and Hwang Kyo-ahn. It is a vote to protect vested interests, not to bring change to the broader conservative base," and emphasized, "A vote for Lee Jun-seok is seed money for investment in the future—a vote to help the broader conservative sector start anew based on youth. For the future of the Republic of Korea, the survival of conservatism, and the hope of the younger generation, I ask for your decisive support." The day before, Lee also posted that while he expected Lee Jae-myung to win, he wanted voters to choose him as the new alternative for the conservative bloc. He wrote, "Various public opinion indices are roughly outlining the election. There is no reason to ignore scientific statistical indicators," and continued, "If we can secure a certain level of support in this election, we can prevent Korea from leaning completely to one side and rekindle the flame of hope." Hong Min-sung, Hankyung.com reporter mshong@hankyung.com

<Today's Major Economic Events> ▶︎Mon, 2nd: △Japan Q1 Capital Expenditure (KST 08:50, JST 08:50), △Federal Reserve Board Member John Williams' Speech (KST 09:00, local time 1st 20:00), △US May Manufacturing PMI (KST 22:45, local time 09:45), △Federal Reserve Chair Powell's Speech (KST 3rd 02:00, local time 13:00) <Today's Major Cryptocurrency Events> ▶︎Mon, 2nd: △Ethena (ENA) 40,630,000 token unlock, △Hedera (HBAR) JavaScript SDK update

With the early presidential election just a day away, anticipation for the Korean virtual asset (cryptocurrency) market is intensifying. There is growing opinion that regardless of which candidate wins the election, the virtual asset industry will see positive effects. On the 1st (local time), Bloomberg News highlighted Korea’s presidential election, reporting that the growth of the Korean virtual asset market could be determined by the election outcome. Bloomberg noted, "Both of the main candidates, Lee Jae-myung and Kim Moon-soo, introduced pro-virtual asset policies during their campaigns," and evaluated, "This could potentially make Korea a more virtual asset-friendly environment." Kim Seo-joon, CEO of Hashed, also commented, "Since all the main candidates support pro-virtual asset policies, domestic virtual asset investors can expect a clear win regardless of the election outcome."

Recently, opinions have emerged that short-term profit strategies are gaining spotlight in the virtual asset (cryptocurrency) market. According to Cointelegraph, a digital asset-focused media outlet, on the 1st (local time), Arashi Yasabolian Taoshi AI founder said, "Recent tariffs have caused headline-driven volatility across the financial markets. Extreme changes can happen in just one day," and added, "This has made market trading much more difficult." Furthermore, he stated, "Accordingly, intraday trading—taking profit when available—has become popular among traders," and added, "We’ve also captured this trend internally and have shifted to these strategies."

<Key Economic Events Next Week> ▶︎2nd (Mon): △Japan Q1 Capital Expenditure (KST 08:50, local time 08:50), △Speech by Federal Reserve Governor John Williams (KST 09:00, local time 1st 20:00), △US May Manufacturing PMI (KST 22:45, local time 09:45), △Speech by Federal Reserve Chair Powell (KST 3rd 02:00, local time 13:00) ▶︎3rd (Tue): △Korea Early Presidential Election (all day), △Korea May Consumer Price Index (KST 08:00), △EU May Consumer Price Index (KST 18:00), △US Department of Labor April JOLTS Report (KST 23:00, local time 10:00) ︎▶︎4th (Wed): △Korea Q1 GDP (KST 08:00), △US May Nonfarm Payrolls Change (KST 21:15, local time 08:15), △US May Services PMI (KST 22:45, local time 09:45) ▶︎5th (Thu): △EU Interest Rate Announcement (KST 21:15), △US Initial Jobless Claims (KST 21:30, local time 08:30) ▶︎6th (Fri): △Korea Stock Market Closed for Memorial Day, △US May Nonfarm Payrolls Index (KST 21:30, local time 08:30), △US May Unemployment Rate (KST 21:30, local time 08:30) <Key Cryptocurrency Events Next Week> ▶︎2nd (Mon): △Aetna (ENA) 40,630,000 token unlock, △Hedera (HBAR) JavaScript SDK update ▶︎3rd (Tue): . ︎▶︎4th (Wed): △Avail (AVAIL) Korea AMA ▶︎5th (Thu): △IoTeX (IOTX) IIP-42 vote, △VeraChain (BERA) SafePal AMA ▶︎6th (Fri): △Siacoin (SC) V2 hard fork

Ross Ulbricht, the founder of the dark web black market 'Silk Road,' who enjoys strong support from the cryptocurrency community, reportedly made profits amounting to $1.8 million (about ₩2.5 billion) through auctions. According to Cointelegraph, a specialized cryptocurrency media outlet, on the 1st (KST), Ross Ulbricht auctioned off items he used—such as a sleeping bag, backpack, lock, clothing, and drawings created while incarcerated—on the Bitcoin (BTC)-only marketplace 'Scarce City.' The most valuable item sold at the auction was Ulbricht’s prison ID, which he used during his incarceration. Ulbricht’s prison ID was sold for 11 Bitcoins. Previously, in 2013, Ulbricht was sentenced to life imprisonment for operating the dark web Silk Road. However, with President Donald Trump fulfilling his campaign promise and granting Ulbricht a pardon on January 21, 2025, he will be released after about 11 years in prison.

There is a range of opinions surrounding the hot topic of stablecoins (virtual assets whose value is linked to fiat currencies) in the recent virtual asset (cryptocurrency) market. In particular, some forecasts suggest that, if stablecoin legislation is passed in the United States, stablecoins could restructure the U.S. financial system. On the 1st (Korean time), Bloomberg News stated, "Recently, stablecoin legislation is gaining bipartisan support within the United States," and assessed that "if this bill passes and demand for stablecoins surges, it could completely change the U.S. financial system." The outlet further diagnosed that the effects of stablecoins could include ▲ increased demand for U.S. Treasury bonds, ▲ strengthened global reserve currency status of the U.S. dollar, and ▲ growth of fintech companies. Analysts also endorsed these opinions. Theresa Ho, a JPMorgan Chase analyst, explained in a stablecoin report, "If stablecoin legislation passes in the United States, mainstream adoption and legitimacy of stablecoins could accelerate," and she analyzed that "demand for stablecoins could increase." There is also an analysis that demand for U.S. Treasuries, which can be used as collateral assets for stablecoins, will rise. Ronit Ghose, a Citigroup analyst, forecasted, "Stablecoins will additionally purchase as much as USD 1 trillion worth of U.S. Treasuries by 2030, which could have a tangible impact on financial markets." There are also analyses that the use of stablecoins may expand beyond the current crypto-asset market. Marion Laboure and Camilla Siazon, Deutsche Bank analysts, explained, "Stablecoins offer low remittance fees and are a payment method available 24/7," adding, "They are efficient for trade, remittance, and payment." Furthermore, they noted, "In emerging economies, stablecoins may be used as a means to hedge against inflation," and "It may stimulate unofficial dollarization." However, there are still issues that need to be reexamined concerning stablecoins. Notably, whether trust in assets can be maintained and concerns about unfair competition. Analyst Theresa Ho stated, "If finance is restructured by stablecoins, bank runs into stablecoins could occur in stressful situations. Furthermore, there's a potential for unfair competition depending on whether there is access to the Federal Reserve." Nonetheless, she continued, "One thing that is certain is that, as the industry continues to research integrating stablecoins into traditional finance, there will be even more changes moving forward."

In May, while the virtual asset (cryptocurrency) market saw a boom, decentralized exchanges (DEX) recorded the second largest trading volume in history. According to DeFiLlama on the 1st (Korea time), the May DEX trading volume totaled $474.135 billion (about ₩656 trillion). This is the second largest monthly DEX trading volume following last January. The chain that recorded the highest DEX trading volume was the Binance Coin (BNB) chain. On the BNB Chain DEX, the trading volume reached $178.228 billion (about ₩250 trillion). The crypto-specialized media Odaily analyzed that "the increase was influenced by the Alpha Airdrop and trading competitions held on the BNB Chain."

Recently, it has been revealed that scams encouraging investors to deposit money into virtual asset (cryptocurrency) exchanges by luring them with offers of free 'rapidly rising stocks' on social media (SNS) are spreading widely. On the 1st, the Financial Supervisory Service (FSS) issued a 'caution' level consumer alert, urging vigilance against financial scams that direct people to fake virtual asset exchanges. Fraudsters use bait such as 'free rapidly rising stocks' on SNS to attract investors, then have them sign up on fake cryptocurrency exchange websites and induce them to invest. Specifically, they provide bogus financial seminars for an extended period and distribute fake coins to deceive consumers. Subsequently, they lead victims to invest in fake virtual asset exchanges and, under the pretense of mandatory liquidation, demand large deposits from the consumers and steal their money. The FSS stated, "Consumers should be suspicious if approached with offers of 'financial seminars,' 'attendance bonuses,' or 'rapidly rising stocks' for free," and cautioned, "Do not conduct any transactions with companies that try to guide you to join cryptocurrency exchanges through Telegram or similar channels." They further emphasized, "In particular, you must never deposit money with unverified companies or personal accounts," adding, "Since virtual asset businesses that are not registered with the Financial Intelligence Unit (FIU) may be fake exchanges intended for scams, always be sure to check their registration status."