South Korea’s Ruling, Opposition Parties Clash Over Stablecoin Regulation

The pronunciation and opposition parties of South Korea submitted dueling Stablecoin legislation on Monday and set up a parliamentary struggle for crypto regulation, since the nation wants to establish its place in the global crypto economy.

Legislator of the Democratic party Ahn Do-Geol has submitted Extensive regulations for won-pegged stablecoins that prohibit those explicit interest payments. At the same time, the prevailing people power parties Kim Eun-hye submitted Competing legislation that omits any mention of a ban on interest.

Both accounts grant emergency powers to financial supervisors, whereby the Bank or Korea is authorized to request information and to conduct inspections to support monetary policy.

The legislative collision comes as President Lee Jae-Myung a push Crypto-friendly agenda And racing Global Powers to regulate Stablecoins, which have emerged as regular payment methods due to lower transaction costs and near-instructive settlement.

“The Stablecoin regulation of Korea requires a balanced approach that combines essential government supervision with substantial freedom of the private sector,” said Rich O., APAC Regional Manager at Hardware Wallet Company OneKey, said Decrypt.

“Although government control is necessary for monetary sovereignty, consumer protection and systemic risk management, excessive limitations can undermine Korea’s competitiveness in the worldwide landscape of digital assets,” he said.

The AHN account imposes stricter requirements, whereby Stablecoin is offered who obtain the approval of financial services and retain a minimum capital of $ 3.6 million (5 billion) won.

“This bill stems from discussions within the DP committee for the future economic growth strategy and reflects the campaign blax of President Lee,” said Ahn, according to Korea Joongang Daily.

All tokens must be fully supported by high liquidity assets, explicitly prohibited with interest payments, according to the BILL text.

Kim’s legislation focuses on license requirements and extensive disclosure obligations, making the submission of white papers and product descriptions for Stablecoin expenditure mandatory.

Its bill aims to promote “innovation in digital activationing” and “to improve the reliability of the digital assets market,” said the legislative text.

Reserve -requirements and protection

The proposal of the Democratic Party requires 100% support by money, demand deposits, government bonds or municipal bonds.

In bankruptcy scenarios, reserve activa would be given priority within three working days for the reimbursement of users and “cannot be seized or used as collateral,” said AHN.

“Just like the US with his digital dollar, Korea has to enter a new era of financial sovereignty with a stablecoin won,” he said.

The People Power Party Bill includes provisions for “things related to the repayment of digital assets with fixed value and the composition and management of reserve assets”, together with requirements for emennials to maintain financial and management solidity.

Bank of Korea Gouverneur Rhee Chang-Yong showed support For won-backed stablecoins last month, while the need emphasizes the need to investigate their impact on society management.

“The regulatory framework must focus on results instead of scriptive methods,” said Rich O., argue for clear standards, while innovation in yield mechanisms and cross -border functionality allows.