“Monetary Policy Significantly Affects Financial Stability…Central Banks Need Substantial Legal Authority”, Governor Lee Chang-yong of the Bank of Korea speaks at a press conference on the direction of monetary policy held at the Bank of Korea in Jung-gu, Seoul on the 17th. 2025.4.17/News1 © News1 Photo Cooperative,
(Sejong = News1) Reporter Kim Yoo-seung – Regarding the issuance of stablecoins based on the won as underlying assets, a claim has been raised within the Bank of Korea that “substantial legal authority is needed from the authorization stage.”
According to the Bank of Korea on the 12th, Ko Kyung-chul, Head of the Electronic Finance Team at the Bank of Korea, presented on the topic of ‘Trends and Future Challenges of Stablecoins’ at the Korean Financial Law Association’s academic conference on the 9th, arguing that “stablecoins significantly affect central banks’ policy implementation, including monetary policy, financial stability, and payment systems.”
Stablecoins refer to cryptocurrencies issued at a fixed value of existing currencies such as the dollar or won. Currently, the issuance of won-based stablecoins is not permitted domestically.
The Bank of Korea believes that if won-based stablecoins become active, they would replace the demand for legal currency and significantly impact monetary policy. In reality, stablecoins like Tether (USDT), which are based on the US dollar, are already used in place of dollars in overseas remittance and payment sectors.
Ko stated, “By substantially intervening in the authorization stage, the central bank should minimize the negative impacts on policy implementation.”
Previously, in last month’s payment report, the Bank of Korea also stated that “stablecoins could infringe on monetary sovereignty and undermine the effectiveness of monetary policy,” and emphasized the need for careful consideration upon their introduction.
Disagreements among institutions regarding the authority to issue stablecoins have also been expressed. The draft of the Basic Law on Digital Assets, released last month by Min Byung-deok, a lawmaker from the Democratic Party of Korea, included a provision designating the Financial Services Commission instead of the Bank of Korea as the authority for issuing stablecoins.