By 
The Governor of the Bank of Korea (BoK), Rhee Chang-yong, has stated that the central bank is not opposed to the issuance of a won-pegged stablecoin, but raised concerns over its potential implications for foreign exchange (forex) stability.
According to a report on Wednesday, Rhee noted during a press conference that while issuing a digital won stablecoin could support domestic innovation, it might inadvertently increase reliance on U.S. dollar-backed stablecoins if not carefully managed.
“Issuing won-based stablecoin could make it easier to exchange them with dollar stablecoins, rather than reducing the use of dollar stablecoins,” Rhee said, warning that such a shift could complicate the central bank’s efforts to manage forex dynamics.
The remarks come amid dwindling forex reserves in South Korea, which declined from $415.6 billion in December 2024 to $404.6 billion by the end of May 2025, reflecting an $11 billion drop over six months, according to official BoK data.
Regulatory Momentum for Stablecoins
Governor Rhee’s cautious endorsement coincides with South Korea’s accelerating regulatory agenda under President Lee Jae-myung. The administration’s ruling Democratic Party recently introduced the Digital Asset Basic Act, aimed at providing a formal framework for stablecoin issuance and oversight.
Under the proposed legislation, companies with a minimum equity capital of ₩500 million (approximately $368,000)would be eligible to issue stablecoins. Issuers would be required to maintain sufficient reserves to guarantee redemptions and obtain approval from the Financial Services Commission (FSC), the country’s primary financial regulatory body.
This aligns with President Lee’s broader campaign promise to foster a friendlier digital asset regulatory environment, particularly for younger investors. The FSC is also investigating fee structures across local crypto exchanges as part of efforts to reduce transaction costs.
Non-USD Stablecoin Alternatives Gaining Ground
The global stablecoin market remains dominated by U.S. dollar-backed tokens, particularly Tether (USDT) with a market capitalization of approximately $156 billion, and USD Coin (USDC) at around $61 billion, according to data from DefiLlama.
However, alternative fiat-backed digital currencies are gaining momentum. Notably, Circle’s euro-pegged stablecoin EURC has seen a 156% surge in 2025, reaching a market capitalization of $203 million.
Investor confidence in non-dollar stablecoins was further bolstered this week following progress in U.S. Congress on the GENIUS Act, a proposed federal regulatory framework for stablecoins. Circle’s stock rose significantly on the news.
Outlook
While the Bank of Korea remains open to exploring digital innovations such as stablecoins, Governor Rhee’s remarks underscore the importance of balancing fintech progress with macroeconomic safeguards—particularly around forex volatility and cross-border liquidity management.
As South Korea seeks to position itself as a leader in digital finance, the interplay between domestic policy reforms and global monetary dynamics will be critical in shaping the future of won-based digital assets.
Comments