South Korea’s Financial Services Commission (FSC) is moving ahead with plans to introduce a comprehensive Digital Asset Basic Act as the country works to expand its crypto regulatory framework beyond investor protection.
Ahead of a July 29 policy briefing to the National Assembly, the regulator said it will work with the ruling Democratic Party to prepare a single bill covering stablecoins, crypto exchanges, disclosures, internal controls and system resilience. The proposal comes as opposition lawmakers continue efforts to scrap the country’s planned crypto income tax before it takes effect in January 2027. Neither proposal has changed existing law.
🇰🇷 South Korea is preparing for the next phase of crypto.
The Financial Services Commission is working on a government-backed digital asset framework covering areas like stablecoins and exchanges.
At the same time, lawmakers are pushing to remove the planned 22% crypto tax set… pic.twitter.com/Oe3rpMIl5A
— That Martini Guy ₿ (@MartiniGuyYT) July 29, 2026
FSC plans single crypto bill to replace multiple proposals
The FSC said it intends to combine several pending legislative proposals into one government-backed Digital Asset Basic Act that would serve as the main framework for future negotiations.
The proposed legislation would establish rules for stablecoin issuance and circulation, define digital asset businesses and introduce standards governing exchange operations, market disclosures and user protection.
The move follows the introduction of South Korea’s Virtual Asset User Protection Act, which mainly focuses on custody, unfair trading practices and protecting users. The new legislation would open oversight to cover stablecoin issuers, crypto service providers and the wider digital asset market.
One of the biggest debates is whether issuers of won-backed stablecoins should be controlled by bank-led consortiums holding at least 50% plus one share. While the Bank of Korea supports giving banks a leading role because of potential financial stability risks, some lawmakers and industry participants favour allowing qualified non-bank issuers under licensing and reserve requirements.
Lawmakers are also expected to debate ownership limits for major crypto exchanges, along with governance standards, cybersecurity requirements and compensation rules for system failures. The FSC has yet to release a draft or announce when the bill will be formally submitted.
South Korea’s crypto community divided over the reforms
South Korea’s latest crypto proposals have received a mixed response from investors and industry participants. While many welcome the government’s effort to replace multiple pending bills with a single regulatory framework, concerns remain over some of the proposed rules.
Many in the industry believe a unified Digital Asset Basic Act would provide long-term regulatory clarity after months of uncertainty. However, traders and exchange operators have raised concerns that possible ownership limits on major platforms such as Upbit and Bithumb could weaken the competitiveness of domestic exchanges and discourage investment.
The proposed framework for won-backed stablecoins has also started a debate. Some industry participants argue that requiring issuers to be majority-owned by bank-led consortiums would make it harder for private companies to compete and limit innovation in South Korea’s digital asset sector.
South Korea’s crypto tax is also back under debate
Alongside the regulatory bill, opposition lawmaker Song Eon-seok has proposed repealing the provision that would impose a 22% tax on annual crypto income exceeding 2.5 million won from January 1, 2027.
The opposition argues the measure unfairly targets crypto investors while most retail stock investment gains remain untaxed. However, the government continues to support implementation, and tax authorities have already created a dedicated digital asset unit to prepare for enforcement.
The repeal proposal will move through parliamentary review, while a separate public petition calling for the tax to be scrapped is also awaiting consideration. Unless lawmakers approve another delay or repeal, the tax is scheduled to take effect on January 1, 2027.
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