South Korea’s FSC Nominee Dismisses Crypto Value and Endorses Stablecoin Push

Highlights:

• Lee has warned that crypto volatility prevents it from acting as money.
• The FSC nominee has dismissed crypto but has voiced support for the stablecoin plans.
• Over 16 million South Koreans now use local exchanges as younger investors seek returns despite government skepticism.

Lee Eok-won has strongly questioned the value of cryptocurrencies. In a written response to lawmakers, he stated that digital assets lack intrinsic value. Lee, the nominee for chairman of South Korea’s Financial Services Commission (FSC), said this difference makes them unlike traditional financial instruments such as equities or deposits. Lee also emphasized ahead of his confirmation hearing that their volatility prevents them from serving as a store of value or medium of exchange.

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He warned against exposing pensions and retirement funds to such assets. According to him, these funds require security and stability, not speculation. In his view, individuals relying on their retirement assets in old age face an increased danger if these funds are linked to an extremely unpredictable market. His comments made it quite obvious that he does not support institutional investors’ plans to incorporate cryptocurrency into their long-term portfolios.

Local industry leaders reacted promptly to his comments. Some have said that his evaluation of cryptocurrencies fails to take into account the increasing importance of digital assets in international banking. They pointed out that major corporations and organizations keep Bitcoin and other cryptocurrencies in their reserves. According to them, blockchain-backed transferability and security provide a form of digital utility that cannot be ignored.

FSC Nominee Dismisses Crypto but Supports Stablecoins

While Lee expressed skepticism toward cryptocurrencies, he offered a more balanced view on other financial products tied to digital assets. On exchange-traded funds, he admitted that both opportunities and risks exist. He noted that the FSC will study global practices and work with lawmakers to decide how to proceed. His cautious tone showed he does not want to rush decisions that could affect South Korea’s financial market.

However, Lee took a supportive stance toward stablecoins. He said that he intends to create opportunities for growth in this sector while keeping safeguards in place. His comments align with the government’s broader efforts to launch a stablecoin pegged to the Korean won. The initiative, which has the backing of President Lee Jae-myung, seeks to solidify monetary sovereignty in light of the growing importance of digital banking.

Other regions in Asia are also pursuing similar projects. Japan and Hong Kong are developing stablecoins that are pegged to their respective currencies. These initiatives aim to combine digital efficiency with currency stability. South Korea appears to be preparing to follow the same direction, with Lee signaling a willingness to expand stablecoin development even while dismissing broader cryptocurrency innovations.

🇯🇵NEW: JAPAN TO LAUNCH FIRST GOVT-BACKED STABLECOIN THIS FALL 🎌 FINTECH FIRM JPYC LEADS THE PROJECT, AMID EXPECTED YEN INTEREST RATE HIKE. pic.twitter.com/hKCie9nmeh

— Coinwaft (@coinwaft) September 1, 2025

Youth Adoption and Market Context

Lee’s comments come at a time when a rising number of individuals in South Korea are using cryptocurrencies. More than 16 million people are active on local exchanges, according to recent data.

A lot of these users are young investors. A lot of individuals are turning to cryptocurrencies because the economy continues to get worse, and there are not many options in traditional markets. Experts say that this trend is not so much about believing in Web3 innovation as it is about looking for short-term gains. Many people are turning to riskier investments because of financial issues, even though people like Lee are still skeptical.

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