Book warns of South Korea. star-news.press/wp

The Central Bank of South Korea expressed its warning of the potential consequences for issuing encrypted cryptocurrencies, which raised fears that its adoption could unintentionally reinforce the demand for the US dollar -backed Stablecooins.

Korea Bank Governor (Book) Lee Chang Young to caution Such developments may undermine the wider monetary policy objectives and the complexity of foreign exchange management.

Stablecoin policy collision with foreign exchange department

Speaking at a press conference on Wednesday, the ruler Lee indicated that instead of reducing the impact of Stablecoins in dollars, the local Stablecoin can be easy to use.

“The version of Stablecoin may not reduce the use of Stablecoins in dollars, but rather facilitates the exchange between Stablecoins in dollars and Stablecoins won,” he said.

According to Lee, this shift can eventually increase the demand for the dollar, a dynamic that can act against President Lee Jay Meong’s agenda of strengthening the Korean role he won in digital financing.

While President Lee called for the development of the KRW -based Crypto Stablecoins to help reduce the foreign flows of capital and build flexibility in the digital economy, Bok’s position refers to a more cautious approach.

The ruler explained to me that the central bank does not mainly oppose the cdecooins supported by the Korean, but he stressed that the organizational framework must be a practice to manage its impact on financial stability.

He specifically pointed to the challenges in overseeing foreign currencies and risks to the traditional banking sector. One of the areas of concern includes changing payment and settlement services away from banks towards non -banking entities that will manage Stablecoin transactions.

He called me to a broader discussion on how this transition affects the profitability of the bank and the general structure of the financial industry. He said: “We need to draw the largest image on how the banking industry is transferred, such as its profit, (it will be affected) in the event of the transfer of payment and settlement services to Stablecoins.”

Global trends and local considerations

The continuous debate in South Korea comes amid great developments in the organization Stablecoin at the international level. In the United States, the recent residence of the Genus Law, which aims to regulate and encourage the use of Stablecoins in dollars, intensified discussions about the role of these digital assets in both local and international financial systems.

As of today, Crypto Stablecoins Completely represents more than 260 billion dollars in the market value, with more than $ 253 billion of the distinctive symbols of the US dollar, according to Coingecko Data.

The Ministry of Economy and Finance is expected to cooperate in South Korea and the Financial Services Committee with BOK on the formation of Stablecoin’s future policy.

Whether the country can publish a successful KRW Stablecoin strategy without escalating dependence in dollars still represents a major challenge to move forward.

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