South Korea is taking a major step toward regulating stablecoins by preparing a comprehensive framework that could reshape the nation’s digital asset landscape. The country’s Financial Services Commission (FSC) is set to introduce a government bill in October 2025, aiming to provide guidelines on issuance, collateral management, and internal control systems for stablecoin projects.
A Government-Led Push Toward Stablecoin Regulation
According to local reports, the upcoming legislation is part of the second phase of South Korea’s Virtual Asset User Protection Act. Lawmakers have been briefed on the draft policy, with Democratic Party of Korea (DPK) Representative Park Min-kyu confirming that the FSC intends to submit the bill to the National Assembly in October.
The framework has been under development since 2023 through the FSC’s virtual asset committee, reflecting the government’s intention to establish clearer rules for crypto service providers operating in the country.
Reducing Dependence on Dollar-Pegged Stablecoins
One of the bill’s core goals is to encourage the issuance of won-backed stablecoins. At present, the global market is dominated by dollar-based stablecoins, with data from RWA.xyz showing that out of the $266.7 billion stablecoin market, $266.2 billion (99.8%) is tied to the U.S. dollar.
South Korean policymakers believe that a domestic won-pegged stablecoin could reduce reliance on the dollar while strengthening financial sovereignty. The movement gained traction after President Lee Jae-myung pledged support for a national stablecoin initiative during his campaign.
Several legislative proposals have already been introduced by lawmakers, such as:
- Digital Asset Basic Act – Rep. Min Byung-deok
- Act on the Issuance and Circulation of Value-Stable Digital Assets – Rep. Ahn Do-gul
- Act on Payment Innovation Using Value-Pegged Digital Assets – Rep. Kim Eun-hye
In June 2025, major South Korean banks announced a joint initiative to develop a won-pegged stablecoin. The project, designed to counter growing dollar dominance, is expected to materialize in late 2025 or early 2026.
By linking banking infrastructure with blockchain innovation, the initiative is expected to accelerate the adoption of stablecoins in domestic payments, remittances, and tokenized financial products.
Tackling Tax Evasion Through Crypto Oversight
Alongside the stablecoin push, authorities are stepping up efforts to prevent tax evasion via cryptocurrencies. On August 18, 2025, tax officials in Jeju City began freezing and seizing digital assets from individuals suspected of using crypto to avoid tax obligations.
This move highlights the government’s dual strategy: while supporting innovation in regulated digital assets, it is simultaneously cracking down on illicit use of cryptocurrencies.
South Korea’s Stablecoin Future
With the FSC’s bill expected in October 2025, South Korea is positioning itself as a key player in the global stablecoin market. By establishing a won-backed stablecoin framework, the country aims to reduce dependence on U.S. dollar-pegged tokens, enhance financial security, and create new opportunities for blockchain integration in its financial system.
If successfully implemented, South Korea’s initiative could serve as a blueprint for other nations considering national stablecoins, while strengthening the country’s role as a leader in digital finance innovation.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.