South Korea to consider Digital Asset Act
South Korea unveils Digital Asset Basic Act to unify crypto regulation
On June 10, South Korea’s Democratic Party formally introduced the Digital Asset Basic Act, a sweeping legislative proposal aimed at creating a unified regulatory framework for cryptocurrencies, stablecoins, and digital asset service providers.
Lawmaker Min Byeong-deok announced the bill’s submission during a press conference, calling it a critical step toward establishing transparency, investor protection, and South Korea’s leadership in the global digital economy, reports Crypto News.
The proposed law builds on the Virtual Asset Investor Protection Act—effective since July 2024—by expanding its scope beyond investor safeguards to include licensing regimes, government oversight, and market conduct enforcement.
Stablecoin licensing at the heart of new framework
A major component of the bill is the introduction of a licensing system for issuers of Korean won-backed stablecoins. These issuers would be required to maintain ₩500 million (approx. $367,890) in minimum capital and obtain regulatory approval from the Financial Services Commission (FSC).
Additional safeguards include bankruptcy remoteness provisions and reserve asset requirements to guarantee user redemptions in the event of insolvency. The proposed regime aims to protect end users while building trust in stablecoin products—seen as central to South Korea’s evolving crypto payments infrastructure.
Expanded oversight and industry governance bodies
The bill also outlines the formation of a Digital Asset Committee under the Presidential Office to coordinate national crypto policy. Complementing this will be the Digital Asset Industry Association, a private-public entity charged with monitoring market practices, including token vetting and exchange listings through independent subcommittees.
Regulatory teeth come via expanded powers for the FSC, which would be authorized to investigate market misconduct and impose penalties for unfair trading. Companies in the sector would face registration, approval, and disclosure requirements, further integrating digital assets into South Korea’s formal financial oversight system. The act’s timing aligns with President Lee Jae-myung’s recent inauguration on June 4, reinforcing his campaign pledges to legalize spot crypto ETFs, enable institutional crypto investment, and explore pension fund participation in digital markets.
Recently we wrote that South Korea has recorded its first institutional cryptocurrency transaction since easing a longstanding ban on such activities.
