The Democratic Party of South Korea has formally presented the Digital Asset Basic Act, with a Stablecoin License Regime and extensive supervision under the government of President Lee Jae-Myung.
During a June 10 press conferenceLegislator Min Byeong-Dok announced the submission of the bill and called it a fundamental step towards an extensive regulation of digital assets, including Stablecoins, cryptocurrencies and related service providers.
Min said the legislation was designed to improve the protection of transparency and investors and at the same time position South Korea as a world leader in the digital economy.
The Digital Asset Basic Act builds on the existing Virtual Asset Investor Protection Act, which came into force in July 2024.
While the previous legislation focuses primarily on protecting investors, the new proposal sketches a broader framework that defines digital assets, determines new license and approval systems and supervisory mechanisms under the Financial Services Commission.
An important characteristic of the bill is the permit requirement for expenditure of Korean won-backed stablecoins.
In particular, Empendents must enforce a minimum capital of ₩ 500 million (approximately $ 367,890) and approve the Financial Services Commission.
Moreover, they must guarantee such as bankruptcy distance and reserve management and reserve management to guarantee user’s exchange rights, even if the stablecoin emittent becomes insolvent.
In addition, the regulations have laid the foundation for regulating all issues of digital assets and trading activities. It includes provisions to set up a Digital Asset Committee under the President’s office to coordinate the national policy for digital assets.
In the meantime, a separate entity that is called the Digital Asset Industry Association should be charged with monitoring market practices and evaluating the suitability of tokens for exchange lists through special subcommissions.
In order to tackle misconduct on the market, the bill grants the investigation authority of the Financial Services Commission and enables it to impose fines for unfair commercial activities. It also introduces approval, registration and reporting requirements for companies that are active in the digital assets sector.
The introduction of the Digital Asset Basic Act only comes a few days after President Lee Jae-Myung’s inauguration on 4 June. Lee, who won the presidency with more than 49% of the votes, had campaigned on a platform with strong support for digital asset acceptance and regulatory clarity.
His campaign proposals include legalizing place Crypto ETFs, expanding institutional access to digital assets and enabling the nation’s pension fund to allocate capital to crypto markets.
Min Byeong-Dok, who led the Digital Asset Committee of the party during the Lee campaign, argued for a broader crypto regulation, but has put a special emphasis on the urgency of launching a domestic stabilecoin framework to USDC and USDC and USDTT.
