Regulatory Steps in South Korea

Min Byung-deok, a Democratic Party member in South Korea, introduced the "Digital Asset Basic Act" on June 10, aiming to regulate digital asset businesses with licensing, capital requirements, and consumer protections. Notably absent was any mention of stablecoins as monetary tools, sparking discussions on their future role.

Global Stablecoin Trends

At the Money Market Fund Conference in Boston, experts like Yie-Hsin Hung highlighted stablecoins' significant investment in U.S. Treasury bills, suggesting their growing influence on financial markets despite their current small market share.

Bank of Korea's Warning

The Bank of Korea's "June Financial Stability Report" raised alarms over stablecoins becoming prevalent payment methods, warning of risks like coin runs that could threaten financial stability.

Market Reactions

Stablecoin-related stocks, including U.S.-based Circle and South Korean firms like Kakao Pay, have seen volatile trading, reflecting the market's uncertainty over stablecoins' future.

Diverging National Perspectives

While South Korea explores stablecoins for efficient domestic transactions, the U.S. sees them as vital for absorbing massive Treasury bond issuances, with Tether already a major Treasury holder.