It’s been five months since the ruling Democratic Party of Korea proposed its Basic Digital Asset Act which would regulate stablecoins. It proposed allowing non banks and payment providers to issue stablecoins, with the Financial Services Commission as the primary regulator rather than the Bank of Korea. The Financial Services Commission has been given the responsibility for drafting government proposals, but there were reports that the Bank of Korea had lobbied to ensure that banks owned at least 50% of any stablecoin issuer consortium. However, the Financial Services Commission (FSC) recently responded to press reports, saying it has not confirmed the consortium approach.
Today the Maeil Business reported obtaining a copy of the FSC’s proposals, which includes an evaluation of the pros and cons of various structures. If one or more banks control more than 50% of a stablecoin issuer, that may address the Bank of Korea’s financial stability concerns. However, it noted that most stablecoin issuers around the world are not banks, and the market should decide on the ownership structure. While the FSC cited 14 out of 15 EU MiCA-regulated stablecoins as non banks, the actual figure is 14 out of 17 EU issuers – but the point about non bank dominance still holds. The three bank issuers are Banking Circle, SocGen FORGE (a bank subsidiary, not a bank itself) and ODDO.
The discussions reflect different global regulatory approaches. The Bank of Korea is keen to protect monetary policy so wanted some influence over Won stablecoin issuers by creating a committee (similar to the US GENIUS Act), but the FSC has rejected this idea. However, the current proposals give the central bank more influence over systemic stablecoins, although the central bank will not be the regulator.
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