South Korea moves to legalize stablecoins with new crypto bill
Lee's ruling Democratic Party proposed the Digital Asset Basic Act on Tuesday, aimed at improving transparency and encouraging crypto sector competition, Bloomberg reported.
The bill stipulates that local companies can issue stablecoins with a minimum equity capital of 500 million won ($368,000). They must also guarantee refunds through reserves and get regulatory approval from the Financial Services Commission, the country's finance regulator.
South Korean stablecoin trading is surging with transactions involving the leading US dollar stablecoins reaching 57 trillion won ($42 billion) on five main domestic exchanges in the first quarter, according to Bank of Korea data.
The new legislation is expected to bolster such trades and boost one of the region's largest crypto markets, with more than a third of the population, or around 18 million people, reportedly participating. Lee works to fulfill election promises
South Korea's opposition leader Lee was sworn in as president following a decisive snap election victory on June 3.
In addition to his plans for a local currency stablecoin, Lee also advocated for South Korea's national pension fund to invest in Bitcoin and crypto, in addition to pledges to permit the launch of Bitcoin exchange-traded funds (ETFs) in the country.
'We need to establish a won-backed stablecoin market to prevent national wealth from leaking overseas,' he said during a policy discussion in May. Bank of Korea opposes stablecoin policy
Lee's crypto ambitions are facing central bank opposition, with Bank of Korea Governor Rhee Chang-yong warning that non-bank stablecoins could weaken monetary policy effectiveness.
The central bank argued that it should take the lead in regulating a local currency stablecoin.
South Korean investors could still be burned from their investments in the multibillion-dollar Terra blockchain and its algorithmic stablecoin that was co-created by local Do Kwon, which collapsed in May 2022. South Korean crypto stocks react
South Korea's crypto push is fueling a rally in local stocks such as mobile payment and digital wallet service KakaoPay, which has seen shares jump as much as 45% over the past five days, according to Google Finance.
However, JPMorgan analysts Stanley Yang and Jihyun Cho said, 'The rally in Kakao-related shares is fundamentally unjustifiable, as any concrete benefit from Lee's stablecoin policy remains uncertain.'
Source: https://cointelegraph.com/news/south-korea-plan-allow-stablecoins-introduces-bill
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The National
7 hours ago
- The National
Trump announces 25% tariffs on South Korea and Japan in first trade letters
Donald Trump said on Monday he will place universal 25 per cent tariffs on South Korea and Japan, apparently the first two countries to receive trade letters from the US President. Mr Trump, citing trade imbalances, said the so-called reciprocal tariffs on America's two trading partners would be implemented on August 1. In the letters addressed to the countries' leaders - posted on his Truth Social platform - Mr Trump warned both South Korea and Japan not to retaliate. 'If for any reason you decide to raise your tariffs, then, whatever the number you choose to raise them by, will be added on to the 25% that we charge,' he wrote. US markets slid following the announcement, with the Dow Jones Industrial Average dropping 507 points – or 1.13 per cent. The S&P 500 and Nasdaq Composite fell 0.90 and 0.94 per cent, respectively. Mr Trump had said he would be issuing trade letters to trading partners beginning this week with countries that would dictate their tariff rate. He had previously announced reciprocal tariffs of 25 and 24 per cent on South Korea and Japan, respectively, as part of his 'Liberation Day' announcement on April 2. Those reciprocal tariffs, along with dozens of others, were then delayed for 90 days following turmoil in financial markets that prompted Mr Trump to reverse course. His shifting trade policy began a new era of uncertainty in the global economic outlook, with central bankers and economists trying to understand how the effects of tariffs will relate to the cost of goods, hiring and firing practices, investment and more. Earlier on Monday, Treasury Secretary Scott Bessent said Mr Trump's administration expected to make 'several' trade-related announcements within the next two days. As of Monday, the US had only agreed to trade deals with the UK and Vietnam. 'We've had a lot of people change their tune in terms of negotiations. So, my mailbox was full last night with a lot of new offers, a lot of new proposals,' Mr Bessent told CNBC. Washington and Beijing had also previously agreed to lower their tariff rates on each other as part of a so-called trade truce. Mr Trump has also threatened to impose an additional 10 per cent tariff on any country that aligns itself with the Brics alliance.
Khaleej Times
7 hours ago
- Khaleej Times
Trump imposes 25% tariffs on allies Japan, South Korea
US President Donald Trump said Monday he was slapping 25 per cent tariffs on Japan and South Korea, in his first letters to trading partners ahead of a deadline to reach a deal with Washington. Trump had said at the weekend that starting from Monday he would send a first batch of up to 15 letters to countries informing them that he would reimpose harsh levies that he had postponed in April. In near-identically worded letters to the Japanese and South Korean leaders, Trump said the tariffs would apply from August 1 because their trading relationships with Washington were "unfortunately, far from reciprocal." Trump warned the countries, both key US allies in East Asia, of an escalation if they responded to the new US tariffs. But he also said he was ready to modify levies "downwards" if Japan and South Korea changed their trade policies. Japan's Prime Minister Shigeru Ishiba said Sunday that he "won't easily compromise" in trade talks with Washington. Trump originally announced sweeping tariffs on world economies on what he called "Liberation Day" on April 2, claiming the United States was being "ripped off." Amid market turmoil, Trump then suspended the initial tariffs for 90 days, a deadline that expires on Wednesday. But the Trump administration has said that the duties will not "boomerang" back until August 1, apparently extending the deadline despite denials from officials. While the Trump administration has signalled hopes of striking dozens of deals by early July, at one point boasting of "90 deals in 90 days", there have been limited results so far. Washington has unveiled pacts with only Britain and Vietnam, while the United States and China agreed to temporarily lower tariff levels on each other's products that earlier reached three-digits. 'Change their tune' Treasury Secretary Scott Bessent said there would be a number of deals coming up. "We are going to have several announcements in the next 48 hours," Bessent told CNBC in an interview Monday. "We've had a lot of people change their tune in terms of negotiations. So my mailbox was full last night with a lot of new offers, a lot of new proposals," Bessent said. There was no immediate response from the White House on whether Trump would formally extend the Wednesday deadline for the tariffs to snap back. Asked about Trump's letters, Bessent said these would inform partners of the tariff rate their products face when trading with the United States, unless they want to "come back and try to negotiate." Bessent told CNBC Monday that he would "be meeting with my Chinese counterpart sometime in the next couple of weeks." The two sides have so far held high-level talks in Geneva and London. But Washington and Beijing's pause on tit-for-tat tariffs is due to expire in mid-August. On whether he was disappointed in the number of trade deals achieved so far, Trump's trade adviser Peter Navarro maintained that he is "happy with the progress we've had." "Every country that we run a major deficit with is fully engaged," he told CNBC on Monday. Trump has also threatened another 10 per cent tariff on countries aligning themselves with the emerging BRICS nations, accusing them of "Anti-American policies" after they slammed his duties at a summit. For now, partners are still rushing to avert Trump's tariffs altogether. The European Commission said that EU chief Ursula von der Leyen had a "good exchange" with Trump on trade when the pair spoke Sunday.
Khaleej Times
8 hours ago
- Khaleej Times
UAE Golden Visa: New service to help Bangladesh residents apply from Dhaka
Bangladeshi residents can now apply for UAE Golden Visa in a more convenient, informed way as VFS Global, a visa outsourcing and technology services company, offers expert advisory services for applicants. Visa aspirants in Bangladesh can apply online for this service, or by calling the dedicated helpline +880 1739 861116. Located in Dhaka, this specialised service will be the maiden roll out from the Centre of Excellence jointly set up by VFS ETM, a unit of VFS Global group, in partnership with Rayad Group recently. This opportunity allows eligible individuals including business owners, professionals, scientists, entrepreneurs, creatives and influencers to apply for a 10-year UAE residency, following the approved criteria. Visa holders can sponsor their spouse, children (including adult children), parents, and household staff to live in the UAE. The Dhaka centre will assist individuals with migration processes and compliance with immigration regulations, utilising advancements in Generative AI technology alongside legal expertise. "We believe there is strong demand for immigration advisory services, particularly for the UAE Golden Visa. In line with our customer-first policy we are delighted to roll out this solution that empowers applicants to get sound understanding of the immigration process and take informed decisions,' said Yummi Talwar, COO of South Asia division in VFS Global. 'The UAE's unique combination of economic stability, favorable tax policies, and luxurious living standards positions it as a premier destination for high net worth individuals seeking new opportunities and an elevated quality of life,' Rayad Kamal Ayub, MD of Rayad Group, said.
