The Bank of Korea has renewed its proposal to keep Korean won-pegged stablecoin issuance mainly within commercial banks, citing concerns over monetary policy control and financial stability.
In a report submitted to the National Assembly Strategy and Finance Committee, the central bank described won-backed stablecoins as “currency-like substitutes” that must be carefully regulated.
Bank of Korea urges regulators to restrict won-denominated stablecoin issuance to licensed commercial banks only, citing money laundering and financial stability concerns. pic.twitter.com/ay8qK0LEVL
— mracrypto (@MRACRYPTO_) February 23, 2026
Bank of Korea warns of financial stability risks
The bank warned that privately issued stablecoins could be exploited to bypass foreign exchange reporting rules and potentially weaken capital flow monitoring. Allowing non-bank firms to issue such tokens independently could also conflict with South Korea’s traditional separation of banking and commercial business activities.
The central bank suggested a bank-first issuance framework because banks are already subject to strict capital, governance, and compliance standards. It is recommended that any expansion beyond banks should occur gradually after comprehensive risk assessments. Officials also proposed a consortium-style issuance structure led by banks, alongside a statutory interagency body to coordinate approvals and supervision.
Regulators remain divided over stablecoin framework
The debate over South Korea’s stablecoin legislation continues as policymakers struggle to finalize rules. Industry participants have argued that restricting issuance mainly to banks may limit innovation. Sangmin Seo, chair of the Kaia DLT Foundation, previously said the bank-led approach lacks strong logical justification, adding that clearer issuer rules could better manage risks.
The report also highlighted programmable stablecoins as a potential driver of digital payment innovation while emphasizing the need for safeguards. The bank cited the United States’ multi-agency supervisory model involving the Treasury Department (United States), Federal Reserve, and Federal Deposit Insurance Corporation as a possible reference.
Lawmakers remain split over whether banks should hold majority control in stablecoin issuers. Discussions have delayed the framework initially expected last year, with officials now hoping for progress in upcoming legislative sessions. Meanwhile, South Korea’s crypto industry faces new uncertainty as lawmakers consider imposing ownership limits on centralized exchanges.
Enjoyed this piece? Bookmark DeFi Planet, explore related topics, and follow us on Twitter, LinkedIn, Facebook, Instagram, Threads and CoinMarketCap Community for seamless access to high-quality industry insights.
“Take control of your crypto portfolio with MARKETS PRO, DeFi Planet’s suite of analytics tools.”
