South Korea’s central bank has reportedly reaffirmed its position that issuance of Korean won–pegged stablecoins should remain under the control of commercial banks. The Bank of Korea (BOK) warned lawmakers that allowing private entities to issue digital tokens could undermine monetary policy and pose foreign-exchange and financial stability risks.
In a report submitted to the National Assembly’s Strategy and Finance Committee, the BOK described won stablecoins as “currency-like substitutes” and stressed that their rollout must balance industrial benefits with monetary policy, foreign exchange stability, and financial risk considerations, according to local reporting.
The central bank reiterated concerns that privately issued stablecoins could be used to circumvent foreign exchange regulations, including reporting requirements, and argued that non-bank issuance could conflict with Korea’s principle of separating banking from commerce. It recommended that banks — already subject to capital, governance, and compliance standards — be allowed to issue stablecoins first, with any expansion to non-bank entities proceeding gradually following risk assessments.
The report comes as lawmakers continue to debate a delayed stablecoin framework, with key sticking points including eligibility for issuance and the degree of control banks should hold over issuing entities.
Central bank proposes safeguards
While acknowledging that programmable stablecoins could support digital asset innovation and function as payment tools, the BOK also suggested structural safeguards. These include a bank-centered consortium model and a statutory interagency policy body to coordinate approvals and supervision across regulators.
The central bank cited the United States’ GENIUS Act as an example, where cross-agency oversight involves the Treasury Department, Federal Reserve, and the Federal Deposit Insurance Corporation.
Legislative debate stalls
The BOK’s report echoes its earlier warnings that banks should lead stablecoin issuance, given their existing regulatory obligations. However, this stance has faced pushback from industry participants and some lawmakers.
Sangmin Seo, chair of the Kaia DLT Foundation, previously told Cointelegraph that the argument for banks leading the rollout lacks a “logical foundation,” adding that clear rules for issuers could effectively mitigate risks.
Regulators remain split over whether banks should hold a majority stake in stablecoin issuers. This disagreement delayed legislation originally expected in October 2025. Although lawmakers anticipated a resolution by January, a final timeline for the framework has yet to be announced.
