The Bank of Korea will actively participate in formulating stablecoin regulations

The Bank of Korea said it will actively participate in the development of stablecoin regulations to guard against latent risks to monetary and financial stability. South Korea is working on the second part of cryptocurrency legislation, which will focus on transparency requirements for stablecoins and crypto services.
"Unlike general virtual assets, stablecoins are inherently a means of payment," the Bank of Korea said in a report on payments systems on Monday. "If their use expands, it may weaken the effectiveness of monetary policy." The central bank also pointed out that stablecoins could transmit the risk of cryptocurrency-related crises to traditional financial marekts, threatening financial stability and the integrity of payment and settlement systems.
South Korea is currently working on a follow-up legal framework to its first cryptocurrency law, which came into effect in July 2024 and focuses on protecting cryptocurrency investors by setting stricter requirements for exchanges.