South Korea Delays Stablecoin Bill Amid Regulatory Disputes and Market Developments
South Korea's Financial Services Commission (FSC) missed the December 10, 2025 deadline to submit a stablecoin bill to the National Assembly. The government now plans to publish its official position alongside the bill's submission, which is tentatively titled the Basic Digital Asset Act (Phase Two). The release is expected later in December 2025 or early January 2026.
The delay stems from a dispute between the FSC and the Bank of Korea over who should lead stablecoin issuance. The Bank of Korea advocates for a bank-led issuance model, requiring banks to hold at least a 51% stake, along with inspection powers and veto rights. Conversely, the FSC points to international models under the EU's MiCA framework that allow non-bank issuers. It also highlights Japan's yen-linked stablecoin issued by a fintech company and warns that a bank-led approach could limit technology firms' participation.
Negotiations continue, including discussions on flexible ownership thresholds based on business scope, but no consensus has been reached. Meanwhile, lawmakers at the National Assembly's Political Affairs Committee are reviewing multiple competing draft bills, further delaying progress.
Currently, domestic stablecoin issuance remains illegal. Despite this, several projects are underway: Naver Financial is building a local currency wallet in Busan, KakaoBank is developing a Korean won-denominated digital token, and various banks are exploring a joint project targeted for late 2025 or early 2026.
This regulatory uncertainty was highlighted following the December 2025 Upbit hack. Authorities noted that Binance froze only a small portion of the stolen funds, underscoring the need for clearer oversight mechanisms.
Delays in crypto policy continue, with the introduction of a virtual asset tax regime now postponed to 2027. These setbacks have raised concerns that South Korea may fall behind regions like the US, EU, and Japan in establishing stablecoin regulations.
