South Korea’s ruling Democratic Party is reportedly drafting a bill that would classify stablecoins as foreign currency payment instruments and require tokenized real-world assets (RWAs) to be backed by fiduciary assets.
Citing the integrated draft of the proposed Basic Law on Digital Resources, Seoul Economic Daily reported on Wednesday that stablecoins used in cross-border transactions will be treated as “tender of payment” under the Foreign Exchange Transactions Act, bringing related companies under supervision even without separate registration.
The bill would also require issuers of tokenized risk-weighted assets to place the underlying assets in managed trusts in accordance with the Capital Markets Act.
If implemented, the changes would bring stablecoins and tokenized RWA assets under existing financial regulations, tightening oversight of cross-border flows and establishing custody requirements for the underlying assets.
As of Wednesday, Cointelegraph had been unable to independently verify the draft regulations through a public submission to the National Assembly.
Stablecoin draft aims for cross-border exploit, prohibits interest
The Seoul Economic Daily also reported that the project will exempt certain stablecoin payments for goods and services from foreign exchange reporting requirements to a certain extent.
The bill reportedly prohibits issuers from paying interest to holders of stable-value digital assets, regardless of how the incentive is labeled. The report said it would also require the Financial Services Commission to establish technical standards aimed at ensuring the interoperability of digital asset networks.
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The reported approach is in line with previous concerns expressed by South Korea’s central bank.
On January 27, Bank of Korea Governor Lee Chang-yong warned that Korean won-denominated stablecoins could complicate capital flow management and currency stability, deepening the debate on how to regulate domestic stablecoins.
The fresh project will transfer tokenization to existing structures
On the risk-weighted assets side, the bill would reportedly require issuers to place related assets in managed trusts under the Capital Markets Act. According to the report, the requirement would tie the issuance of tokenized assets to existing custody frameworks.
According to the report, the project did not address key issues such as exchange ownership limits and banking requirements for stablecoin issuers.
These omissions stem from broader disagreements over how the bill should regulate stablecoins. On December 31, disagreements over stablecoin supervision and issuer requirements delayed the passage of the Digital Assets Basic Law.
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