First Federal Stablecoin Law Passed in the U.S. Senate, What About Korea? With the upcoming Korea presidential election many hot topics are being discussed. One of them, aimed at winning support from men in their 20s and 30s is crypto policy, especially around Korean won-based stablecoins. Unfortunately Korea currently has no clear laws or policies about stablecoins. Meanwhile today in the U.S., the first federal stablecoin bill, the GENIUS Act, just passed the Senate. Other countries like Singapore, Japan, Hong Kong, and those in Europe already have well-developed regulatory frameworks. For example, Singapore’s SCS framework, Japan’s Payment Services Act amendments, Hong Kong’s sandbox for stablecoin issuers, and the EU’s MiCA framework are already in effect. What’s more worrying is that Korean politicians and public institutions still don’t fully understand stablecoins. For example, presidential candidates Lee Jae-myung and Kim Moon-soo say Korea must issue a won-based stablecoin to protect monetary sovereignty from the growing use of U.S. dollar-backed stablecoins. But they don’t give any details on how this would actually work. The issue isn’t just about making a new coin – it’s about the fundamental competitiveness of our currency. Stablecoins have no borders, so the global trend toward the dollar can't simply be stopped. Even euro or yen-backed stablecoins haven’t been able to challenge the dominance of dollar-based ones. Even Lee Jun-seok, a candidate who is considered to understand crypto better, made a mistake during a recent debate. He said that USDC can freeze user funds, but USDT cannot – which is incorrect. Stablecoins are now an unstoppable trend. According to a report by @ARKInvest, in 2024, stablecoin transaction volume has already surpassed that of Visa and Mastercard. The U.S. just passed the GENIUS Act in the Senate, so Korea is not too late – but to catch up, we must act fast to build a regulatory framework and infrastructure. That’s why @FourPillarsFP in partnership with Hashed Open Research (led by former Vice Minister of Finance Yongbeom Kim), is working on a follow-up to our first report on won-based stablecoins. We're collaborating with legal, accounting, and finance experts to explore practical ways to issue and use a Korean won stablecoin. In this new report, I personally focus on how stablecoins are being used for payments, remittances, interbank settlements, and as base currencies on exchanges. I argue that how stablecoins are used is just as important as how they are issued. Right now, Korea is leaning toward a bank-centered model for stablecoin issuance. But even if issuance is safe, a coin is useless if people don’t use it. Japan’s bank-issued stablecoins have seen very low adoption, and in Europe, EURCV (issued by Societe Generale) is far less used than EURC (issued by Circle), even though both follow MiCA. Why? Because stablecoins issued by banks are usually overregulated, making them hard to use overseas or on-chain. They end up being treated like just another deposit, which defeats the purpose of stablecoins and makes adoption very slow. Korean politicians say they want to issue a won stablecoin to protect the country from the growing power of the dollar. But if it's only issued by banks, it likely won’t be used outside of Korea. And since Korea already has great fintech and banking services, there won’t be strong reasons for people to switch to a domestic-only stablecoin. So this would not actually help protect monetary sovereignty. Instead, if we want to issue a Korean won stablecoin, we should take a capital markets approach and allow non-bank issuers, as long as they meet strict requirements for user protection, just like in MiCA, MAS, and the GENIUS Act. We should also make sure stablecoins have real use cases where their unique strengths can shine. Stablecoins are here to stay. Korea shouldn’t just build a regulatory framework that “looks good on paper.” We need to build a real environment where a won-based stablecoin can be issued and used in ways that truly protect our monetary sovereignty.