South Korea is moving closer to a formal framework for stablecoins as lawmakers advance a new crypto bill aimed at strengthening oversight while reducing systemic risk. The proposed legislation, known as the Digital Asset Basic Act, seeks to establish minimum standards for virtual asset businesses operating in the country, with a particular focus on stablecoin issuers. Under the draft, companies issuing stablecoins would be required to hold at least 5 billion won in capital before launching operations. Lawmakers backing the measure say the requirement is designed to prevent poorly funded projects from entering the market and to ensure issuers can withstand periods of stress. The bill is expected to be submitted to the National Assembly ahead of the Lunar New Year, marking a key step in South Korea’s broader push to bring structure and accountability to its fast growing digital asset sector.
The capital threshold was agreed during a plenary task force meeting involving members of the ruling Democratic Party of Korea. According to officials involved in the talks, the rule is intended to raise the credibility of stablecoins used within the domestic market and to protect users from sudden failures. Regulators view stablecoins as increasingly important infrastructure for trading and payments, which makes their stability a policy concern rather than a niche issue. Beyond capital rules, the bill also aims to formalize the overall virtual asset market by defining the responsibilities of issuers, exchanges, and service providers. Further coordination with the party’s policy committee and relevant government agencies is planned before the legislation is formally introduced, as lawmakers seek to balance innovation with safeguards that can support long term market confidence.
Another major element of the proposal is the creation of an inter ministerial consultative body tentatively called the Virtual Asset Council. The council would coordinate responses to emergencies such as hacking incidents or major technical failures affecting the crypto market. Leadership of the council would rest with the head of the Financial Services Commission, with senior officials from multiple government departments participating. While some policymakers argued for unanimous voting within the council, the task force rejected that approach, citing concerns over slow decision making and excessive concentration of authority. The structure reflects South Korea’s attempt to centralize crisis management without giving any single institution unchecked control, an issue that has become more sensitive as digital assets gain broader adoption across finance and technology sectors.
Despite progress, several contentious issues remain unresolved. One key debate centers on who should be eligible to issue stablecoins, with differing views on whether banks should be required to hold controlling stakes or whether non bank firms should be allowed greater freedom. Lawmakers are also divided over proposed ownership limits for major shareholders of crypto exchanges, a measure that industry groups warn could hurt competitiveness. While there is general agreement on the intent of tighter oversight, opinions differ on timing and implementation. Some officials favor including all restrictions in the initial bill, while others argue for a phased approach to avoid market disruption. These unresolved points are expected to shape further negotiations as South Korea refines its approach to crypto regulation.
