South Korea Eyes Banks as Gatekeepers for Stablecoin Launches

Central Bank Pushes for Safer Rollout Amid Crypto Boom and Capital Flight Concerns

South Korea’s central bank wants to hand the keys to the country’s budding stablecoin market to banks—at least at the start. That’s the message Bank of Korea Deputy Governor Ryoo Sang-dai delivered this week in a quiet but consequential policy signal aimed at managing financial stability while keeping pace with crypto innovation.

The proposal, which surfaced during a closed-door meeting with top commercial bankers on Tuesday, underscores Seoul’s cautious embrace of digital assets under President Lee Jae-myung’s crypto-leaning government.

Banks First, Everyone Else Later

The Bank of Korea isn’t saying no to stablecoins. It’s saying: let’s go slow.

Ryoo made it clear the central bank isn’t trying to slam the brakes on innovation. But he argued it would be “desirable” to limit stablecoin issuance to tightly regulated banks in the early phase—before opening the door to fintechs, payment firms, and other non-bank players.

There’s logic behind that. Banks are already under the regulatory microscope. They’ve got compliance teams. They file reports. If something goes wrong, authorities know exactly where to look.

“The goal here is to build a kind of safety net,” Ryoo reportedly said, according to local media outlet Yonhap. He described the strategy as a phased rollout that would reduce systemic risks and help avoid “financial instability stemming from unregulated issuance.”

It’s not a ban on non-banks. It’s a delay.

A Stablecoin Surge Sparks Policy Jitters

The timing of this policy shift isn’t random. South Korea is dealing with a sharp uptick in crypto trading and money moving across its borders.

Between Q3 of 2024 and Q1 of 2025, the value of digital asset transactions shot up more than threefold—from $12.9 billion to $42.4 billion. That’s not just a chart that’s going up; it’s a headache for regulators tasked with keeping tabs on money flows, capital flight, and the won’s exchange rate.

And there’s more.

A report by the Financial Services Commission this month revealed that:

Stablecoin transfers abroad hit $19.5 billion in Q1 2025 alone

That’s a big number. And it raised red flags at both the Bank of Korea and the Ministry of Economy and Finance. Officials worry that stablecoins—especially those not tied to domestic banks—could be used to bypass capital controls or move large sums offshore without proper oversight.

One small sentence in Ryoo’s remarks hinted at the stakes: “Unchecked stablecoin issuance could complicate monetary policy and foreign exchange management.” That’s bureaucrat-speak for: this could mess with our entire financial system.

President Lee’s Crypto Pivot Adds Pressure

All this comes as the Lee administration rolls out one of Asia’s most crypto-friendly policy shifts in years.

After taking office with strong support from younger voters—many of whom see crypto as a financial lifeline—Lee has pushed for frameworks that give digital assets room to grow. Earlier this year, his economic advisors floated a proposal to let local firms issue won-backed stablecoins, with regulatory sandboxes to test them.

The president’s crypto task force is drafting legislation that would allow:

Licensed companies to issue stablecoins pegged to the Korean won
Domestic exchanges to offer regulated trading pairs with Korean stablecoins
Cross-border pilot programs with trade partners like Singapore and UAE

But this more permissive approach is forcing regulators to play catch-up. And that’s where the Bank of Korea’s “banks-first” strategy fits in.

Seoul Isn’t Alone in Thinking This Way

Ryoo’s comments may feel specific to Korea, but the blueprint echoes what regulators in other countries are already doing.

In the U.S., the House Financial Services Committee earlier this year backed a bill requiring stablecoin issuers to be insured depository institutions—basically banks. While that legislation hasn’t passed yet, it’s telling that the Fed, Treasury, and OCC all supported the idea in principle.

In the EU, stablecoin rules under MiCA (Markets in Crypto Assets) also give the European Central Bank special supervisory powers over “significant” stablecoins—many of which are expected to be launched by large financial institutions.

Even Japan, whose crypto rules are relatively advanced, has placed strict issuance rules on stablecoins. Last year, it passed a law allowing banks and registered trust companies—but not just anyone—to issue stablecoins under the label of “electronic payment instruments.”

So if South Korea’s policy feels conservative—it actually isn’t. It’s pretty standard fare for any major economy with an open capital account and a serious central bank.

What Comes Next? A Wait-And-See Phase

No exact timeline has been laid out. No draft bill has been introduced either.

But South Korea’s financial authorities are expected to publish a stablecoin issuance framework later this year, which may:

Define who can issue won-backed coins under what conditions
Impose reserve, auditing, and capital requirements on issuers
Lay out supervision roles between BOK and the Financial Supervisory Service

A leaked policy memo reviewed by local outlets this week also hinted at annual transaction caps and limits on foreign usage for the first wave of issuers. That, too, would likely favor banks with existing compliance infrastructure.

There’s a sense of “regulate first, scale later” in the air.