Summary

  • The Bank of Korea said bank-led stablecoin issuance is a second-best option aimed at minimizing conflicts with domestic financial regulations.
  • The Bank of Korea said won-based stablecoin issuance through a bank consortium could begin first, with issuer eligibility expanded once safety is confirmed.
  • The Bank of Korea said setting interoperability and the degree of reliance among a tokenized financial system, private stablecoins, and global blockchains will be a key task.

Forecast Trend Report by Period

The Bank of Korea said a bank-led structure for stablecoin issuance — with the banking sector holding a majority stake of 50% plus one share — is a second-best option in the debate over who should be allowed to issue stablecoins under South Korea’s proposed Digital Asset Basic Act.

Kim Bo-il, head of the BOK’s virtual asset team, made the remarks on November 10 at a seminar titled “Tasks After the Digital Asset Basic Act” held at the Korea Financial Investment Association’s Financial Investment Education Institute.

“Bank-led stablecoin issuance is not the best solution, but a second-best one — an alternative in a situation where no perfect answer exists,” Kim said.

Under the Digital Asset Basic Act being prepared by the Financial Services Commission, authorities are strongly considering limiting won-based stablecoin issuers to bank-centered consortiums.

Kim said the bank-led approach is intended to minimize conflict with South Korea’s existing financial regulatory framework.

“Domestic financial regulation is built on anti-money laundering rules based on the real-name system, the separation of industrial and financial capital, and foreign exchange laws,” he said. “Banks have spent years responding to those regulations, so they have the relevant experience, know-how and systems in place.”

He described the model as a compromise aimed at addressing concerns that blockchain anonymity could be misused to evade regulation.

Issuance could begin with banks, with issuer eligibility expanded later once safety is confirmed, he added.

Kim also said the BOK highly values blockchain’s technical strengths.

Technologies such as smart contracts and programmability could help advance financial markets, he said.

Kim also stressed that the BOK would still have a role to play if stablecoins are introduced.

“Even in a tokenized financial system, there needs to be a central pillar for the monetary system,” he said. “It would be desirable to build a structure in which payment assets provided by the central bank and private stablecoins compete with and complement each other.”

On interoperability between won-based stablecoins and global blockchains, a point the industry has repeatedly emphasized, Kim took a more cautious view.

“Each blockchain, including Ethereum and Solana, operates as an independent system,” he said. “We need to consider how appropriate it is to place a national payment system on global private networks and how much dependence on them is desirable.”

He added that another key task is deciding how to define the relationship between the existing financial system and multiple blockchains, and how to secure interoperability between them.

Authorities also need to discuss how to design the institutional framework for linking those systems.

Uk Jin