The South Korean government is reviewing a plan to recognize stablecoins as legal means of payment within the country’s financial system. This move is part of a revision to the Foreign Exchange Transactions Act, which currently only regulates traditional payment instruments such as banknotes and coins.

The proposed regulatory change aims to give stablecoins a clearer legal status. This would enable the effective regulation and supervision of digital assets in financial transactions by local authorities.

The Bank of Korea previously expressed concerns that stablecoins, especially those backed by the U.S. dollar, could be used for cross-border transactions without proper reporting. Therefore, this legal recognition is expected to help the government enhance transparency and security in digital transactions, while preventing potential misuse for illegal activities such as money laundering.

Purpose and Expected Impact

The initiative aims to provide legal certainty for individuals and businesses using stablecoins, as well as to create a safer digital payment system. With a clear regulatory framework, the government hopes that innovation in the digital finance sector can continue to grow without compromising the stability of the national financial system.

For industry players, the new rule could serve as a stronger foundation for operating in the digital asset sector. On the other hand, regulation may also introduce additional obligations, such as transaction reporting and compliance with specific security standards.

South Korea’s Position in the Digital Asset Industry

South Korea is known as one of the countries most active in regulating the cryptocurrency and digital finance sectors. The country has implemented various measures to protect consumers while encouraging innovation in the blockchain industry.

If the new stablecoin regulation is approved, South Korea could become one of the first Asian countries to legally recognize stablecoins as official payment instruments. This development could further promote broader adoption of blockchain technology in the future.

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Disclaimer
This material is for general informational purposes only and does not constitute investment advice, recommendations, or an invitation to buy or sell cryptocurrencies, digital assets, securities, or derivatives, or to make any investment decisions. Mobee is under no obligation to update this report based on information or events occurring after its creation and publication. Any advice or recommendations contained in this report may not be suitable for certain users.