South Korea is set to advance its crypto regulation efforts with a newly introduced bill that proposes a licensing framework for stablecoin issuers. The bill, known as the Digital Asset Basic Act, was unveiled on Tuesday by lawmaker Min Byeong-deok of the ruling Democratic Party.
New Regulatory Step to Support Korean Won-Based Stablecoins
A key provision of the bill requires stablecoin issuers to be licensed and maintain over 500 million Korean won ($367,890) in owner’s capital. This move aligns with President Lee Jae-myung’s campaign promise to foster a Korean won-based stablecoin ecosystem, aiming to prevent capital outflows through foreign-denominated digital assets.
“Stablecoin issuers must meet financial thresholds and be approved under a new licensing regime,” Min stated during a press briefing.
Min, who led President Lee’s digital asset committee during the election, emphasized that the bill will position South Korea as a leader in the global digital economy.
Building on the Virtual Asset Investor Protection Act
The Digital Asset Basic Act builds on the Virtual Asset Investor Protection Act, which took effect in July 2024. While the earlier legislation focused on safeguarding retail investors, this new proposal sets out to construct a full-fledged regulatory structure for the digital asset ecosystem in South Korea.
“This legislation will be the foundation of a structured and fair digital asset market,” Min added.
Global Alignment with Stablecoin Licensing Trends
The bill mirrors international trends in stablecoin oversight. The U.S. GENIUS Act, Hong Kong’s stablecoin legislation, and regulatory models in the EU and Japan all adopt similar licensing and oversight structures for digital asset issuers.
Min highlighted how global standards now focus on issuing, circulating, and trading digital assets, and South Korea’s legislation is crafted to remain competitive and compliant on the world stage.
Defining Digital Assets and Enhancing Oversight
Beyond stablecoins, the bill aims to:
- Define digital assets and outline their treatment under law.
- Establish a presidentially overseen Digital Asset Committee.
- Introduce legal mechanisms to penalize unfair market practices in crypto trading and investing.
Conclusion
The Digital Asset Basic Act could reshape South Korea’s crypto ecosystem, bringing in stricter oversight, a stablecoin-focused financial strategy, and global regulatory alignment. With strong political support, the bill is expected to accelerate regulatory clarity and investor confidence in South Korea’s rapidly growing digital asset market.