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South Korea Moves to Regulate Stablecoins with New Government Bill
South Korea is gearing up for a major leap into stablecoin regulation, with the country’s Financial Services Commission (FSC) preparing to introduce a government-backed bill for won-pegged stablecoins in October 2025. The move is part of the second phase of the Virtual Asset User Protection Act, aiming to bring clarity and structure to the nation’s rapidly evolving crypto ecosystem.
Government Push for a Homegrown Stablecoin
According to Democratic Party of Korea Representative Park Min-kyu, the bill will be submitted to the National Assembly and will include strict guidelines on issuance, collateral management, and internal control systems for stablecoins. This aligns with President Lee Jae-myung’s campaign promise to support the development of a won-backed stablecoin, reducing the nation’s heavy reliance on dollar-pegged tokens.
Several lawmakers have already proposed supporting legislation, including the Digital Asset Basic Act and other initiatives from both major political parties, showing bipartisan support for the shift toward stablecoin innovation.
Korean Banks Join the Stablecoin Race
In a significant show of support, major South Korean banks announced their plans to launch a won-pegged stablecoin by late 2025 or early 2026. Their goal is to shield the Korean won from the growing influence of the U.S. dollar, which dominates 99.8% of the current $266.7 billion stablecoin market, according to RWA.xyz.
Tax Authorities Target Crypto Users
South Korea is also intensifying its crackdown on crypto-based tax evasion. This week, tax officials in Jeju City began freezing and seizing digital assets from nearly 3,000 suspected tax evaders, collectively owing around $14.2 million. Authorities are investigating crypto holdings to settle overdue tax bills, signaling a more aggressive stance on crypto regulation.
