The Bank of Korea supports a phased rollout of stablecoins led by eight major commercial banks to bolster financial regulation and reduce market risks.
Bank of Korea's Strategic Move Toward Stablecoins
The Bank of Korea has endorsed a gradual, bank-led rollout of stablecoins. This marks a critical step toward digital currency regulation, as announced in June 2025 by Deputy Governor Ryoo Sang-dae. Eight major commercial banks in South Korea formed a consortium for a won-backed stablecoin, following the directive from the Bank of Korea that suggests banks serve as initial issuers, backed by higher regulatory scrutiny.
Phased Rollout Targets Market Stability
Financial markets are expected to witness increased stability as the phased rollout aims to minimize disruptions. The focus on regulatory compliance seeks to address previous failures and establish a secure framework. Potential impacts include changes in foreign exchange controls and the handling of won-denominated tokens. The initiative focuses exclusively on the Korean won, with no direct effects anticipated on global cryptocurrencies.
Overcoming Past Regulatory Barriers in South Korea
Past stablecoin efforts in South Korea, such as Binance BKRW, faced regulatory barriers. The current strategy leverages banks to address credibility and compliance challenges that hindered earlier projects. Experts note the potential for reduced liquidity risks, with the bank-led model under strict regulation offering a path to success, differing from earlier, less regulated attempts in the digital currency space.
The stablecoin initiative aims to create a secure financial environment in South Korea. A gradual rollout alongside banks may help avoid past mistakes and establish more reliable conditions for future projects in digital finance.
