TLDR
- South Korea’s ruling Democratic Party has launched a Digital Asset Task Force to regulate stablecoins and digital assets.
- The task force aims to pass digital asset legislation by the end of 2025 to protect South Korea’s financial sovereignty.
- The party plans to establish a won-based stablecoin policy to counter U.S. dollar-backed digital assets.
- Consumer protection is a key focus, with priorities including custody rules, disclosure requirements, and insurance mechanisms.
- The task force will collaborate with government agencies and engage with crypto exchanges to ensure effective regulation.
South Korea’s ruling Democratic Party has launched a new “Digital Asset Task Force” to push legislation for stablecoins and digital assets. This move aims to protect the nation’s financial sovereignty and establish clearer regulations. Officials plan to pass laws by the end of 2025, responding to rising concerns about virtual assets.
Democratic Party Plans Stablecoin Legislation
The Democratic Party’s initiative comes in response to the growing role of stablecoins in South Korea’s economy. Han Jung-ae, chair of the party’s policy committee, stressed that the market demands clear legislation.
“The need for legislation to cover issuance, distribution, and stablecoins of virtual assets is constantly being raised in the market,” she said.
Korean crypto exchanges transferred over $40 billion in digital assets abroad in the first quarter of 2025. Half of these transactions were stablecoins like USDT and USDC, raising alarms among policymakers. Representative Lee Jung-moon, head of the task force, emphasized that the party does not want to be “pushed along” by external trends but aims to “lead the change.”
The task force aims to introduce stablecoin regulations that protect South Korea’s monetary system. By focusing on a won-backed stablecoin, the party seeks to counterbalance the U.S. dollar-dominated market. “We aim to establish a won-based stablecoin policy,” Lee stated, adding that the country should not follow, but lead in digital asset innovations.
South Korea’s Efforts to Protect Consumer Interests
The task force recognizes the importance of consumer protection in digital asset legislation. Peter Chung, head of research at Presto Labs, identified key priorities for the bill.
“Custody rules, disclosure requirements, and insurance mechanisms are the top priorities,” Chung said.
Given the government’s
“pro-growth” stance, Chung anticipates that the legislation will favor “innovation sandboxes.”
These will allow companies to experiment with new technologies without heavy regulatory constraints. The task force will work closely with multiple agencies, including the Financial Services Commission and the Bank of Korea, to ensure a balanced approach.
As the Democratic Party moves forward with its crypto task force, it faces competition from the People Power Party. In July, the opposition party introduced its own stablecoin legislation, creating a parliamentary divide. Rep. Ahn Do-geol of the Democratic Party expressed confidence that a bipartisan consensus on the issue could be reached by the end of the year.
