Speaking at a press conference, Rhee told Reuters:

“Issuing a won-based stablecoin could make it easier to exchange with dollar stablecoins rather than reducing reliance on them. That could increase dollar stablecoin demand and make forex management difficult for us.”

These remarks come as newly elected President Lee Jae-myung pushes ahead with promised crypto regulation and amid a decline in the country’s forex reserves.

Declining Forex Reserves

Data from the Bank of Korea shows that forex reserves dropped from $415.6 billion in December to $404.6 billion by the end of May — a decrease of $11 billion in six months.

New Crypto Framework Proposed

On June 10, the ruling Democratic Party introduced the Digital Asset Basic Act, which would allow companies with at least $368,000 in equity to issue stablecoins, pending Financial Services Commission (FSC) approval and sufficient reserves for refunds.

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The FSC is also investigating South Korean exchanges’ trading fees, aligning with President Lee’s promise to lower costs for young investors.

Non-Dollar Stablecoins on the Rise

While US dollar-backed stablecoins dominate the market, Circle’s euro-pegged EURC has seen a 156% surge in market cap this year, reaching $203 million.

Circle’s stock rose sharply after U.S. lawmakers expressed support for the GENIUS Act, a proposed stablecoin regulation bill expected to pass the House.

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