FSC Seeks BOK, Finance Ministry Participation in Won Stablecoin Law via Interagency Consultative Body

South Korea’s Financial Services Commission is seeking to establish a policy consultative body with the Bank of Korea and the finance ministry as it moves to institutionalize won-denominated stablecoins.

News1 reported on September 29 that Yoo Won-kyu, an official in the FSC’s virtual asset division, made the remarks at a forum hosted that day by Democratic Party lawmaker Kim Hyun-jung titled “Future Governance of Won Stablecoins and Ways to Build a Market Ecosystem Through Overseas Cases.” He said lawmakers are discussing a bill in a way that would set up a consultative body among relevant agencies.

“There appears to be broad consensus on the need for a consultative body involving the FSC, the finance ministry and the Bank of Korea,” Yoo said. The bill is being discussed in a way that would allow the agencies to form such a body and closely coordinate related policy. Because stablecoins could affect not only financial markets but also monetary and foreign-exchange policy, coordination among agencies is needed.

The FSC is preparing legislation to regulate digital-asset businesses, the market and users more broadly, while also reviewing a framework for won-denominated stablecoins. Given the nature of stablecoins, whose value is linked to legal tender, the regulator is focusing on securing sufficient reserve assets and establishing a stable redemption system.

User-protection measures under review in the legislative process also include asset segregation and bankruptcy-remoteness arrangements. The idea is to separate an issuer’s proprietary assets from reserve assets that must be repaid to users and to protect users’ redemption rights even if the issuer goes bankrupt. Yoo said the U.S. GENIUS Act and the European Union’s Markets in Crypto-Assets regulation, or MiCA, also place priority on creating clear regulatory frameworks.

Experts at the forum also stressed the need for a comprehensive framework covering licensing standards for issuers, reserve-asset management, redemption procedures and anti-money laundering, or AML. Kang Hyun-gu, a lawyer at Lee & Ko, presented a consortium model centered on banks with participation from fintech and big tech firms as one possible issuance structure. He also said reserve assets should be legally separated from an issuer’s proprietary assets and that won redemption rights and related procedures should be clearly defined.

Lee Jung-doo, a researcher at the Korea Institute of Finance, proposed using a consultative body centered on the FSC and joined by the finance ministry and the Bank of Korea rather than creating a separate supervisory agency. The FSC and the Financial Supervisory Service would handle issuance approvals and user protection, while the Financial Intelligence Unit would oversee anti-money laundering. The Bank of Korea and the finance ministry would be responsible for payment and settlement and monetary policy, and foreign-exchange policy, respectively. That makes coordination of roles among agencies important.

The discussion also raised the need to manage the distribution stage after issuance. Kim Young-seok, chief executive of Bonanza Factory, said authorities need specific standards on how far transactions should be traced and monitored when stablecoins move from exchanges or custodial wallets to non-custodial wallets controlled directly by users. He added that who monitors those wallets, and to what extent, could become a key variable in determining the practical use cases for won-denominated stablecoins.