South Korea is making a fresh move to formalize digital asset oversight by embedding tokenized assets and stablecoins into existing laws. The proposal signals a shift toward regulated adoption while maintaining strong financial supervision.
According to Seoul Economic Daily, the Democratic Party of Korea included these measures in its Digital Asset Basic Act proposal. The framework focuses on real-world asset tokenization and stablecoin usage within established legal systems. Lawmakers aim to reduce uncertainty while supporting controlled innovation across the sector.
RWA and stablecoin take center stage
Under the proposal, issuers of tokenized real-world assets must secure underlying assets in managed trusts. This is a requirement that is in line with the Capital Markets Act and proper asset backing. Therefore, law enforcement will be able to confirm that digital records are accurate representations of real things that are not in custody.
In the meantime, the bill proposes a definite category of stablecoins as a payment tool. Instead of separate licensing channels, regulators will supervise issuers via foreign exchange authorities. This hierarchy will make compliance easier and will still provide control over the transaction flows in the system.
Additionally, the proposal introduces an exemption for small stablecoin payments used in daily transactions. The foreign exchange reporting will not be mandatory for purchases of low values. This would promote the practical use without sacrificing monitoring in case of large transfers.
Furthermore, regulators intend to ban the yield production of inactive balances in the shape of stablecoins. This limitation is an indication of the financial risks associated with interest-bearing models. Consequently, the policymakers want to avoid the instability that unsustainable returns might cause.
Regulatory delays still a hurdle
At the same time, the Financial Services Commission will establish technical standards for interoperability. Such standards will enable the various stablecoin systems to work across platforms. Moreover, a single system of disclosure will enhance transparency and offer uniform information to market participants.
Nevertheless, the Digital Asset Basic Act has not been fast-tracked as it should be. A rollout initially aimed at 2025 by lawmakers, but legislative obstacles have slowed it down. Nonetheless, the new proposal demonstrates that it remains devoted to the creation of a comprehensive regulatory framework.
Overall, South Korea is taking a structured path toward integrating digital assets into its financial system. Governments are working to establish a system that balances the usability and regulation of RWAs and stablecoins by harmonizing them with the current laws.
South Korea’s latest proposal highlights a careful approach to digital asset regulation. The framework enables innovation and accountability, putting the country in a more secure digital finance environment.