South Korea May Draft Stablecoin Rules Before Crypto Rules

South Korea should introduce stablecoin regulation gradually, offer temporary licensing guidance and give issuers greater operational flexibility before completing its broader Digital Asset Basic Act, according to a policy report released on Wednesday by Hashed Open Research and the Solana Policy Institute. The report summarizes discussions from a June 23 symposium attended by lawmakers, legal specialists and industry representatives.

The Digital Asset Basic Act is intended to become South Korea’s first comprehensive framework for digital assets, covering stablecoins, token issuance, disclosure requirements and market conduct. However, lawmakers have not yet reconciled several competing bills, with disagreements over who should be allowed to issue stablecoins slowing progress.

Lawmakers consider bank-led compromise

Democratic Party lawmaker Ahn Dogeol said policymakers are considering a compromise model in which banks would retain majority ownership of stablecoin ventures while fintech and other non-bank companies would handle day-to-day operations.

The proposal aims to balance financial stability concerns with the need to involve technology companies and payment providers in developing stablecoin services.

Report calls for interim licensing guidance

Kim Hyobong, a partner at law firm Bae, Kim & Lee, said regulators should clearly define which crypto-related activities financial institutions are permitted to conduct. Kim also called for temporary guidance to address uncertainty around stablecoin payment licenses and urged authorities to establish rules for foreign-issued stablecoins operating in South Korea.

He recommended following the European Union’s phased implementation of the Markets in Crypto-Assets Regulation by introducing stablecoin issuance rules before finalizing the wider Digital Asset Basic Act.

Sources:

https://hashedopenresearch.com/research/334e6434-c594-80ca-b9c3-fbdfdd58e033

https://cointelegraph.com/news/south-korea-report-stablecoin-rules-crypto-law