On January 8, South Korea's plan to allow banks to issue stablecoins denominated in won was opposed by lawmakers, highlighting the divisions between the ruling Democratic Party, financial regulators, and the central bank. The Financial Services Commission (FSC) has now changed its stance, supporting the Bank of Korea's (BOK) proposal to restrict stablecoin issuance, allowing only consortia led by banks with majority control. Under the proposed amendments, stablecoins could be issued by consortia with majority bank ownership, but the banks would need to maintain overall majority control (more than 50% ownership). While technology companies could become the single largest shareholder, their shareholding would still need to be lower than the banks' total shareholding.
The proposal would impose stricter requirements on cryptocurrency trading platforms, such as higher IT stability standards, mandatory compensation for losses caused by hacking, and fines of up to 10% of annual revenue. Stablecoin issuers would be required to have at least 5 billion won ($3.7 million) in paid-up capital, a threshold that regulators may raise as the market develops.
