Bank of Korea Plans Deeper Role in Stablecoin Oversight Amid Surging Crypto Use

The Bank of Korea (BOK) has announced plans to take a more proactive role in shaping South Korea’s upcoming regulatory framework for stablecoins, citing concerns about potential threats to monetary policy and financial stability.

In a new payment systems report released Monday, the BOK emphasized that stablecoins—unlike other digital assets—function more like actual payment tools. As such, the central bank warned, their wider adoption could "undermine the effectiveness of monetary policies" and pose systemic risks if left unchecked.

“Stablecoins act as payment instruments and could act as a conduit, transmitting shocks from crypto markets to the broader financial system,” the report said. The central bank added that it will formally outline its regulatory stance to ensure any future framework considers central bank priorities.

South Korea is already pushing forward with its second major piece of crypto legislation. Following the implementation of its inaugural investor protection law in July 2024, a second bill is now underway. This upcoming regulation aims to define the legal treatment of stablecoins and crypto service providers, and introduce tighter rules around token listings and disclosures. The Financial Services Commission is expected to begin drafting the bill later this year.

As of December 2024, South Korea had over 18.25 million crypto investors—more than a third of the country’s population—highlighting the scale of digital asset adoption. The nation's top five exchanges report a combined daily trading volume of $12.1 billion on average, underscoring the urgency for effective oversight.

Alongside regulatory efforts, the BOK continues to trial its central bank digital currency (CBDC). Its upcoming second-phase pilot in October will test peer-to-peer transfers across citizens, retailers, and banks, aiming to evaluate real-world use cases for a state-backed digital won.