Bank of Korea Governor Takes Cautious Stance on Launching a Korean Won Stablecoin

According to the Korea Economic Daily, Bank of Korea Governor Rhee Chang-yong has expressed a cautious stance on the introduction of a won-backed stablecoin. Rhee stated that while he does not oppose a won stablecoin, factors such as foreign exchange market stability and changes in the banking sector’s structure must be considered. He is concerned that a won stablecoin could increase demand for dollar stablecoins, complicating foreign exchange management. Active use of stablecoins may shift payment and settlement functions from the banking sector to non-bank entities, impacting banks’ revenue structures and business models. The Bank of Korea has been conducting experimental research on central bank digital currencies (CBDCs), but the official issuance of a stablecoin would require coordination with financial regulatory authorities. Rhee emphasized that policy coordination with the Ministry of Finance, the Financial Services Commission, and other departments will be carried out, taking into account both the positive functions and potential risks of stablecoins.