South Korea’s Digital Asset Basic Act Speeds Up: Key Issues and What Comes Next

 As the year comes to an end, South Korea’s long-delayed second-phase legislation on virtual assets—often referred to as the Digital Asset Basic Act—is finally gaining momentum. After months of disagreement, the Financial Services Commission (FSC) and the Bank of Korea (BOK) have narrowed their differences and are aiming to submit an official government proposal within December. This marks an important turning point for a regulatory framework that has been stalled for far too long.

However, despite progress among government agencies, the Democratic Party (DP) continues to raise strong objections—particularly regarding two major issues:

  1. the Bank of Korea’s demand that banks hold at least 51% ownership in stablecoin-issuing consortiums, and

  2. the proposed unanimous decision-making rule for the new policy body called the Value Stabilization Committee.

These disagreements mean that the details of Korea’s future won-denominated stablecoin regulations will likely be defined during the upcoming process of merging the government bill with the National Assembly’s own legislative drafts.

Government Agencies Signal “Near Agreement”

Following a meeting of the Democratic Party’s Digital Asset Task Force on December 11, lawmakers indicated that the biggest institutional conflicts were almost resolved.
Rep. Ahn Do-geol stated that a “considerable level of agreement” had been reached between the FSC and the BOK regarding two sensitive topics: who should have authority to issue stablecoins and how the policy coordination committee should be structured.

Government officials echoed this sentiment, noting that both sides were working rapidly toward a unified position. The FSC even emphasized its intention to submit the bill within December, reinforcing a strong sense of urgency.

Lawmakers also stressed that once the government draft is released, it will be combined with the Democratic Party’s existing proposal to finalize a coordinated version as quickly as possible. Their message was clear: there is no room to delay any further.

The Two Core Disputes: “Bank 51% Rule” and “Unanimous Decision System”

Despite the emerging agreement between agencies, the Democratic Party voiced sharp criticism toward what it sees as excessive demands from the Bank of Korea.

The first issue is the BOK’s insistence that banks hold 51% or more of the consortium responsible for issuing stablecoins. Critics argue that this essentially gives the banking sector—and by extension, the central bank—dominant control over private stablecoin operations. DP lawmaker Min Byung-deok expressed that such a structure “does not align with market principles nor global standards,” adding that giving the central bank de facto final authority could hinder financial innovation.

The second issue concerns how the newly proposed Value Stabilization Committee would operate. According to DP lawmakers, the BOK wants a unanimous or consensus-based decision rule, which could function like a veto and allow the central bank to block major decisions. The Democratic Party made it clear that such a governance model is unacceptable, particularly in a fast-moving industry like digital assets.

These statements reveal a firm stance: while the Democratic Party supports stablecoin regulation, it will resist any framework that concentrates too much authority in one institution.

What Happens Next?

The Democratic Party announced that it will convene a major meeting on December 22, inviting over twenty external advisors to review the direction of the legislation. If the government bill is released before then, discussions will focus on evaluating its validity—especially the controversial “bank 51% rule.” If not, the party may move forward with its own independent legislative process.

Although passing the bill within this year appears unlikely due to time constraints, lawmakers have proposed a realistic timeline:

  • December — Receive the government draft

  • January — Submit a merged bill to the National Assembly

  • February — Aim for passage during the provisional session

This schedule reflects the urgency of setting legal standards for stablecoins and broader digital asset markets, especially as global financial systems continue to evolve.

Final Thoughts

South Korea is at a critical juncture in shaping the future of its digital asset ecosystem. The Digital Asset Basic Act is no longer just a proposal—it is becoming a foundational step toward safe, transparent, and globally competitive regulation. While disagreements remain, especially regarding the role of banks and the central bank, the overall direction is clear: Korea is moving toward a structured, institutionalized digital asset framework.

As discussions progress, market participants and investors alike will be watching closely. The outcome will not only determine how stablecoins are issued and managed but may also set an important benchmark for the future of Korea’s digital financial innovation.

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