South Korea’s central bank has identified a transmission channel through which dollar-pegged stablecoin trading can pressure local currencies. In an issue note released on 3 September 2026, Bank of Korea economists Kim Jihyun and Cho Sangheum examined fiat-to-stablecoin pair listings on Binance and found that after such pairs were introduced, demand for stablecoins could spill into conventional foreign-exchange markets and weigh on the paired currency.
The study covered 12 currencies with sufficient cross-exchange data from 2019 to 2025. After Binance listed a direct fiat-to-USDT or USDC pair, local stablecoin premiums fell by roughly 0.33 percentage points. More importantly, higher premiums became associated with significant depreciation in the paired local currency. Across the 30 currencies tracked, the median dollar-stablecoin premium was about 0.8 percent, and Binance held roughly 69 percent of USDT and USDC balances deposited across exchanges, highlighting its structural role.
Korea behaved differently. Because Binance did not offer a direct Korean won–USD stablecoin pair during the sample period, a crypto-demand shock raised the local stablecoin premium by about 0.85 percentage points but had no statistically significant effect on the won-dollar exchange rate. In Brazil, by contrast, a similar shock lifted the premium by only about 0.11 percentage points while the real depreciated by about 0.12 percent.
The Bank of Korea also cited a Bank for International Settlements working paper from March. That paper, covering four USD-pegged stablecoins and 27 fiat currencies, estimated that a 1 percent exogenous increase in net stablecoin inflows raises stablecoin-FX parity deviations by about 40 basis points and depreciates the local currency by about 5 basis points. The BOK said policymakers should weigh stablecoin rules alongside won internationalization and deeper FX liquidity as Korea opens its digital-asset market to broader participation.
