Stablecoin "Skeptics" Take Helm at Bank of Korea, Shifting Legislative Prospects for Korean Won Stablecoin

Gate News, March 23 — With South Korean President Lee Jae-myung nominating Shin Hyung-sung, the head of the Bank for International Settlements’ Monetary and Economic Department, to become the governor of the Bank of Korea, market attention has sharply focused on the country’s stablecoin regulation trajectory. Shin Hyung-sung has historically taken a cautious stance on stablecoins, and his appointment could introduce uncertainties for the legislation surrounding won-pegged stablecoins, which industry stakeholders have been eagerly awaiting.

According to Yonhap News Agency, Shin Hyung-sung publicly stated last August that won-denominated stablecoins could become a channel to circumvent existing foreign exchange controls. He pointed out that exchanging stablecoins with dollar-pegged cryptocurrencies on blockchain protocols could pose a risk of capital outflows from South Korea. This position aligns with the Bank of Korea’s long-standing cautious approach toward stablecoin legislation.

Following his nomination, Shin Hyung-sung will immediately step down from his position at the Bank for International Settlements. A report published by the BIS last year explicitly warned that stablecoins “cannot serve as stable currencies” and noted that, in the absence of regulation, such assets could threaten financial stability and monetary sovereignty.

This personnel appointment comes at a critical juncture for South Korea’s stablecoin policy. During his campaign last year, Lee Jae-myung included the issuance of won-pegged stablecoins as a core economic platform, attracting support from major tech companies and the blockchain industry. Some leading Korean tech firms have already begun preparing issuance plans, aiming to promote cross-border trade and digital finance. However, the Bank of Korea has consistently maintained a reserved stance on such initiatives, concerned that they could weaken the central bank’s control over fiscal policy and capital flows.

Industry insiders reveal that as Shin Hyung-sung prepares to assume his new role, whether he will adjust his stance on stablecoins is a key point of focus. Several companies interested in launching won-stablecoins have previously delayed their plans due to regulatory uncertainties, and now they are closely watching whether the central bank’s policy direction will change. The ongoing contest over stablecoins is expected to reach a pivotal turning point after the new governor takes office.