South Korea is taking steps to legalize stablecoins tied to the won in order to decrease reliance on foreign currencies. President Lee Jae Myung is spearheading this initiative.
Goals of Stablecoin Legalization
President Lee Jae Myung and his team are focused on removing the ban on won-based stablecoins. The main goal is to strengthen South Korea's economic independence and support international trade using digital assets.
Government Stance and Legislation
Lawmaker Min Byeong-deok, serving as Lee's digital assets chief, introduced draft legislation concerning licensing and transparency for stablecoins. He emphasized that won-based alternatives could help reduce capital outflows and lower trading costs.
Criticism and Concerns about Stablecoins
Critics argue that tying stablecoins to the won won't make it an international currency, and there is a risk of speculative abuse. Concerns also arise about potential government control resembling state-controlled money. Min counters these concerns, stressing that stablecoin issuance will remain with private firms.
The development of stablecoins in South Korea could be a significant step towards enhancing the country's position in digital finance. Despite criticism, the initiative aims to make the economy more independent and resilient.
