South Korea is preparing legislation that would create the country’s first legal framework for stablecoins, with the Financial Services Commission (FSC) expected to submit a government bill to the National Assembly in October.
The bill forms part of the second stage of the Virtual Asset User Protection Act and is designed to set standards for won-backed stablecoins. According to a report from MoneyToday, the framework will include rules on issuance, collateral management and internal control systems for firms that handle these digital assets.
Democratic Party lawmaker Park Min-kyu said during a policy debate that he had received a briefing from the FSC on the draft plan. “The government bill is expected to be submitted to the National Assembly around October,” Park said.
The regulator has been working on the framework since 2023 through its virtual asset committee. Officials have stressed the need for clear rules for digital asset providers, particularly as stablecoins grow in importance for payments and trading.
Growing Policy Interest
The idea of a won-based stablecoin has gained political traction since President Lee Jae-myung pledged support for it during his election campaign. Several lawmakers have also introduced related proposals.
These include the Digital Asset Basic Act from Democratic Party representative Min Byung-deok, the Act on the Issuance and Circulation of Value-Stable Digital Assets from Representative Ahn Do-gul of the finance committee, and the Act on Payment Innovation Using Value-Pegged Digital Assets from Kim Eun-hye of the People Power Party.
By putting forward a single government bill, the FSC is aiming to consolidate these different approaches and provide a clear regulatory base. The framework is also expected to reduce reliance on dollar-pegged stablecoins, which dominate much of the market today.
South Korea’s push comes as regulators in the United States accelerate work on their own stablecoin legislation. If approved, the new Korean rules would mark a turning point for the country’s digital asset market, offering legal clarity for service providers while giving regulators more oversight of a fast-growing sector.
Also Read: Japan Prepares to Approve First Yen-Backed Stablecoins This Fall
