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(Seoul=Yonhap Infomax) Dong Kyu Heo – There is a growing call for South Korean credit card companies to be given the initial opportunity to issue Korean won (KRW) stablecoins and to integrate these digital assets into existing card payment networks.
At the same time, experts are urging that the minimum capital requirement for stablecoin issuers, currently set at 500 million won ($370,000), should be raised under the proposed Digital Asset Basic Act.
Kim Sang Bong, Professor at Hansung University, stated at the 2025 Korea Credit Card Academic Society (KOCAS) conference, held at the Korea Federation of Banks in Jung-gu on the 21st, “Among all financial sectors, the card industry is the most technologically advanced and directly involved in payments. Therefore, it should take the lead in issuing KRW stablecoins.”
Kim noted, “The current payment and remittance systems are plagued by high fees and slow settlement. Integrating stablecoins with the financial sector could significantly simplify transaction processes, accelerate settlement, and reduce fees.”
However, he also highlighted potential risks, including increased volatility in the foreign exchange market and changes in the velocity of money circulation following the institutionalization of stablecoins.
“My main concern is that, even now, the USD/KRW exchange rate has risen to 1,470 won. The introduction of KRW stablecoins could further amplify FX market volatility, especially if these coins are traded overseas, as capital flows would accelerate markedly,” Kim explained.
He added, “With 24/7 instant payments enabled, the velocity of money could also increase. When credit cards were first introduced, we saw a significant jump in money circulation speed.”
Kim further warned, “If stablecoin issuers hold large volumes of government bonds, their asset management strategies could directly impact bond yields as major market participants. In the event of technical failures or hacking incidents leading to mass redemptions (coin runs), there is a risk of shocks to the bond market.”
Kim also argued that the Digital Asset Basic Act, currently pending in the National Assembly, should establish separate capital requirements for KRW stablecoin issuers.
“In the US, discussions are underway to require stablecoin issuers to meet bank-level capital and regulatory standards. There needs to be a debate on linking issuance volume to capital requirements. The current 500 million won threshold is quite low and warrants reconsideration,” he emphasized.
dghur@yna.co.kr
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