South Korean legislators are urging financial regulators to present a stablecoin regulation draft by a December 10 deadline. The call comes amid ongoing disputes regarding the role of banks in this regulatory framework.

According to a recent article from Maeil Business Newspaper, the ruling party has notified regulators to finalize the stablecoin legal framework, threatening that independent legislation will be pursued if the deadline is missed.

Kang Joon-hyun, a member of the Democratic Party, remarked, “If the government bill does not come over within this deadline, we will take a drive through legislation by the secretary of the political affairs committee.” If provided in time, he anticipates the bill will be deliberated in an extraordinary session of the National Assembly in January 2026.

The Financial Services Commission (FSC) later commented, stating that no finalized decisions had been made about forming a consortium for KRW-denominated stablecoin issuance. The regulatory body confirmed that stablecoin regulations were discussed during a consultation between the ruling party and the government, agreeing to expedite the government’s bill.

South Korea’s Financial Services Commission headquarters in Seoul Source: Wikimedia

No Consensus on Bank-Led Model

Despite previous reports, the FSC emphasized that no concrete decisions have been made regarding allowing banks to lead the consortium model wherein they would hold a majority equity stake. Disagreements on the banks’ role continue to hinder the formation of a stablecoin regulatory framework in South Korea.

The Bank of Korea (BOK) and various financial authorities have been at odds over the involvement of banks in the issuance of stablecoins pegged to the won. The BOK believes banks should hold at least a 51% stake in any stablecoin issuer seeking regulatory approval, while others advocate for a broader ecosystem.

Why Majority Bank Ownership?

A representative from the BOK stated that banks are better suited for stablecoin issuance due to existing regulatory oversight and their experience with Anti-Money Laundering protocols. Sangmin Seo, chair of the Kaia DLT Foundation, contended that the central bank’s rationale for a bank-led approach lacks a logical basis, suggesting that it would be more beneficial to set clear guidelines for stablecoin issuers instead. He remarked,

“It would be even more valuable if the Bank of Korea could provide guidelines on how these risks can be mitigated and what qualifications are required for an issuer to be regarded as trustworthy.”

This matter was revisited in a meeting held on the same day, with officials expressing the need to consider both the stability of BOK’s monetary policy and the necessity for industrial innovation emphasized by the FSC.