The Bank of Korea remains cautious, pushing for a gradual rollout of stablecoins to protect financial stability.
South Korea’s Democratic Party has introduced a new task force dedicated to cryptocurrency and blockchain policy. The task force will foster growth in the crypto and blockchain sector by developing friendly policies.
Its leaders unveiled the task force on September 24 in the National Assembly. They promised much quicker action, even suggesting that the country might pass its first pro-crypto regulations by the end of 2025.
Han Jeong-ae, the policy committee chair, said South Korea needed a system to keep pace with global financial transformations. She added that they expected stable and sustainable innovation, noting that the first major focus would be stablecoin regulation.
The token issuance and dissemination laws might be enacted even before the end of the year. One of the main arguments favoring this amendment is that it is required to spur investor interest and establish new business models.
Representative Lee Jeong-moon will guide the task force’s work. He will work with Min Byoung-dug, the party’s Digital Asset Committee Chair, who has always insisted that stablecoins drive the next phase of financial innovation.
The Democratic Party has offered a significant contrast to the previous laws, which focused on the exchanges’ activity and ensured that no user funds would be lost to hacking. This time, the party says it would instead like to see the industry grow while keeping a clear foundation for investor activity.
The lawmakers have reportedly cooperated with the most significant institutions, asking the ministries, the Financial Services Commission, and the Financial Supervisory Service to submit their proposals on what the new law should specifically contain. A representative of the Bank of Korea has also been invited to share his outlook on the matter.
The task force seeks to involve the private sector, not just regulators. Organizers are also expected to seek guidance from crypto exchanges, fintech startups, and venture capital firms. There will also be a panel of advisors comprised of industry experts.
Lee Jeong-moon said they were seeking to consider the digital asset market as a new way for people to carry out transactions. He added that the focus was on policies that would generate future growth.
The DP has also expressed support for a ruling by the government to end the proscription of venture capital investments to crypto companies. Legislators say new funding could come soon to startups hamstrung by tight banking restrictions.
Lee Jeong-moon said they were seeking to consider the digital asset market as a new way for people to carry out transactions. He added that the focus was on policies that would generate future growth.
In July, a similar bill allowing non-financial firms to issue won-denominated stablecoins was introduced in parliament. It was a huge step in opening Korea’s financial world.
But the Bank of Korea has been cautious. This month, Deputy Governor Kim Woong-seok said regulated banks should be allowed to issue stablecoins gradually. He maintained that a more measured rollout would safeguard financial stability. The central bank has subsequently established a crypto oversight unit to help coordinate regulation.
Analysts say the DP’s push for swift innovation could collide with the central bank’s conservative approach. The months ahead may determine whether South Korea can reconcile growth and safety.
South Korea is one of the world’s most active crypto markets. Already among Asia’s top performers, South Korea boasts millions of retail investors who trade daily. The government has frequently been repressive, but new measures indicate a move from simply policing and supporting the industry.
