South Korea to Submit Stablecoin Bill in October Amid Push for Won-Pegged Token

Highlights:

• South Korea plans to submit a stablecoin bill in October as part of its digital asset framework expansion plan.
• Major banks and tech firms have voiced support for the stablecoin initiative to build a secure won-pegged stablecoin.
• The FSC bill will set rules for the issuance of collateral protection and risk systems to strengthen financial oversight.

South Korea is preparing to expand its digital asset framework with a government bill centered on stablecoins. The Financial Services Commission (FSC) confirmed that the measure will be included in the second phase of the Virtual Asset User Protection Act. The legislation will set clear rules for stablecoin issuance, collateral management, and internal controls.

🇰🇷 South Korea is stepping up on #stablecoin rules.
The FSC will submit a regulatory bill this October covering issuance, collateral, and risk controls.

Clearer rules, stronger trust, and a step closer to mainstream adoption. 🚀 pic.twitter.com/oIFu5OaJMd

— SWFT Blockchain (@SwftCoin) August 18, 2025

Democratic Party lawmaker Park Min-kyu said during a debate that the FSC briefed him on the timeline. He stated that the bill is scheduled to reach the National Assembly in October. The proposal reflects President Lee Jae-myung’s campaign pledge to build a strong domestic stablecoin system.

Officials say the effort aims to reduce reliance on U.S. dollar–backed stablecoins. These tokens dominate the global market, which currently holds a value of $266.7 billion. Nearly the entire amount remains tied to dollar-based assets. Industry participants argue that a won-pegged stablecoin can protect financial sovereignty and strengthen South Korea’s role in digital finance.

South Korea to Submit Stablecoin Bill in October

The bill will outline requirements for issuance, collateral safeguards, and risk management. Lawmakers argue that the proposal will provide consistency across South Korea’s digital asset sector. Several representatives have already advanced related bills. Min Byung-deok submitted the Digital Asset Basic Act. Ahn Do-gul proposed a bill on the issuance and circulation of stable digital assets. A distinct proposal published by Kim Eun-hye specifically targets payment systems using value-pegged tokens.

In the meantime, large technology companies and banks are beginning to realign with the initiative. Some companies, such as Naver and Kakao, engaged in policy dialogues with legislators to establish a common way forward. The executives of KB Kookmin, Woori, Shinhan, and Hana banks were also present, indicating wide financial sector support. The participants underlined the importance of interoperability of banking and payment systems.

A stablecoin pegged to the won, to be issued by Nonghyup, Suhyup, Citi Korea, and other domestic issuers, is expected to debut towards the end of 2025 or the beginning of 2026. The project will use a trust-based model or a 1:1 deposit token model. Already, industry associations and nonprofit organizations have expressed commitment to the initiative, which is an indication of the momentum that is driving the initiative.

Other countries around the globe are following suit. Recently, the United States passed the GENIUS Act to control stablecoins on the federal level and maintain the dominance of the dollar. Japan is also advancing a yen-pegged stablecoin through fintech firms, underscoring the international race toward national digital currencies.

JUST IN: 🇯🇵 Japan’s Financial Services Agency set to approve the first yen-backed stablecoin this fall.

— ChainDesk (@ChainDesk_) August 18, 2025

Central Bank and Tax Authorities Weigh In

The Bank of Korea has raised concerns about stablecoin expansion. Governor Lee Chang-yong said issuance should remain limited to licensed banks. He warned that multiple issuers could undermine foreign currency management and threaten financial stability.

South Korea has also taken stronger measures on digital asset activity. Tax authorities in Jeju City began seizing and freezing cryptocurrencies from individuals accused of tax evasion. Officials are investigating nearly 3,000 people with arrears worth $14.2 million to determine if they hold assets that can settle unpaid balances. The FSC expects its upcoming legislation to address both oversight and security concerns. The proposal will define who can issue stablecoins and will also set clear conditions for operations.