South Korea's National Assembly introduced its first comprehensive won-based stablecoin bill on July 28, 2025, aiming to establish a regulatory framework that reduces reliance on dollar-pegged stablecoins like USDT and USDC. The legislation, developed through the Democratic Party's Future Economic Growth Strategy Committee, requires high liquidity reserves and permits non-financial entities to issue stablecoins under the Financial Services Commission's oversight.
Concurrently, the Ministry of Economy and Finance launched a review to apply the Foreign Exchange Transactions Act to foreign stablecoins. This could impose remittance limits, enhanced KYC/AML protocols, and transaction reporting requirements – significantly impacting cross-border transfers using major stablecoins. The initiative responds to Terra-Luna's collapse and aims to bolster monetary sovereignty while addressing risks of illicit activities and financial instability.
Representative Ahn stated: 'This bill reflects President Lee’s presidential pledge and involved over ten rounds of consultations with regulators and experts.' The Bank of Korea will monitor monetary policy alignment, with the regulations potentially reshaping compliance for local exchanges and DeFi protocols utilizing stablecoins.