Emre Yumlu 
As South Korea gears up for its upcoming presidential election, crypto-related policies have once again become a key topic in national debates. Presidential candidate and Democratic Party leader Lee Jae-myung has proposed the development of a stablecoin tied to the Korean won, aiming to prevent capital flight and bolster the country’s digital financial infrastructure.
Local Stablecoin as a Tool for Financial Sovereignty
During a recent policy discussion, Lee emphasized that a won-backed stablecoin could reduce South Korea’s reliance on foreign-issued stablecoins such as USDT and USDC. He believes this initiative would help retain domestic capital and protect national wealth from flowing out of the country.
Current regulations in South Korea prohibit the issuance of domestic stablecoins, forcing local exchanges to depend on USD-pegged digital assets. Between January and March 2025, approximately 56.8 trillion won (roughly $40.8 billion) left domestic exchanges, a large portion of which was linked to foreign stablecoins.
To counter this trend, Lee advocates for a stronger national framework that would enable digitally sovereign financial tools.
Broader Crypto Agenda: ETFs and Pension Fund Access
Lee’s vision for digital assets goes beyond just stablecoins. His platform includes legalizing spot crypto ETFs, allowing institutional players and public pension funds to invest in crypto once certain price stability standards are met. He also supports lower transaction fees and establishing a comprehensive government-led monitoring system.
However, these proposals have raised concerns among economists. Shin Bo-sung, a senior researcher at the Korea Capital Market Institute, warned that large-scale adoption of stablecoins might lead to excessive money supply growth and potentially shift monetary control into the hands of private entities.
New Legal Framework for Digital Assets
To address regulatory uncertainty, the Democratic Party recently launched a Digital Asset Committee, which held its first session at the National Assembly in Seoul on May 13. The committee aims to develop clear policies and foster sustainable growth within the crypto industry.
An upcoming legislative proposal titled the “Digital Asset Basic Act” is also on the agenda. This law would set out detailed rules for stablecoin issuance, requiring issuers to hold reserves of at least 50 billion won and receive approval from financial regulators.
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