The Central Bank of South Korea intends to supervise stablecoins
South Korea intends to monitor cryptocurrency after Terra USD crash
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South Korea joins the European Union, the United Kingdom, and the United States in introducing standards for stablecoins issuance.
Source: BANK OF KOREA
According to the report of the Central Bank of Korea, stablecoins need stronger regulations than other digital assets since they may pose a threat to the country's financial stability. It also shares the UK concerns, which is already developing measures for crypto regulation. The report states that stablecoin issuers must have minimum capital and reserve assets to reduce the risks of insolvency. The document also states that crypto-asset businesses must be registered and licensed to operate. Regular external audits must also become mandatory.
Cryptocurrency needs to be regulated by a special law, because its issue structure and market system are different from securities and fiat currencies, which makes it difficult to regulate with current rules,
reads the notice.
In recent years, South Korean authorities have been cracking down on digital assets. As of August, about 13 cryptocurrency bills are waiting to be debated in the parliament.
In June, the South Korean government set up a committee specifically to oversee the digital asset market following the Terra network collapse. Around 280,000 South Koreans are believed to have fallen victim to the sharp drop in the stablecoin Terra USD value and its sister token LUNA.
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