South Korea’s long planned overhaul of its digital asset regulatory framework has been pushed back to 2026 as disagreements over stablecoin control continue to stall progress. Authorities have broadly agreed on the need for stronger investor protections and clearer rules for exchanges and service providers, but divisions over who should issue and manage stablecoins have delayed the submission of the Digital Asset Basic Act. The proposed legislation is intended to establish a comprehensive legal structure for crypto activity, including stricter disclosure standards and enhanced consumer safeguards. However, unresolved debates between financial regulators and the central bank have slowed momentum at a time when South Korea remains one of Asia’s most active crypto markets.
At the center of the delay is a dispute over stablecoin reserves and issuer governance. Financial regulators have proposed requiring stablecoin issuers to maintain full reserve backing in bank deposits or government bonds, held by licensed custodians. The Bank of Korea has taken a more restrictive stance, arguing that stablecoins should only be issued by bank led consortia with majority ownership to protect monetary stability. Regulators overseeing capital markets have pushed back against fixed ownership thresholds, warning that such rules could limit participation from technology firms and slow innovation in digital payments. The disagreement has proven difficult to resolve, preventing lawmakers from finalizing the framework needed to move the bill forward.
The delay has introduced uncertainty for exchanges, stablecoin issuers, and payment firms operating in South Korea. While there has been no immediate market reaction, industry participants have expressed concern that prolonged regulatory ambiguity could weigh on investment decisions and innovation plans. The stalled legislation also affects discussions around reopening domestic token offerings under tighter supervision. Political pressure is increasing as the government weighs the strategic importance of a won denominated stablecoin to preserve monetary sovereignty. Lawmakers are now expected to revisit the issue next year, with competing proposals under review, leaving the future structure of South Korea’s crypto market dependent on how regulators balance financial stability with technological development.
