South Korea's Central Bank Demands Control Over Won-Backed Stablecoins: A Ticking Time Bomb?

BOK Officials Warn of Monetary Chaos

South Korea's central bank is sounding the alarm, insisting it needs legal authority to approve won-based stablecoins. They're not messing around, warning that these digital assets could totally mess up the country's monetary policy if they're treated like legal tender.

The Bank of Korea (BOK) isn't taking any chances. They're demanding to be in on the ground floor if South Korea ever decides to let these stablecoins loose. A senior BOK bigwig spilled the beans, telling BusinessKorea that the central bank has to be involved from the very beginning.

This BOK official didn't hold back, saying that if these won-based stablecoins start being used like real money, it could throw a wrench into the BOK's monetary policy operations. They're not just asking for a seat at the table—they want to be the ones giving out the approvals. They even pointed out that the Fed in the US has some say in similar situations.

Koh Kyung-chul, the head honcho of the BOK's electronic finance team, is also ringing the alarm bells. He's saying that these stablecoins could shake up how the BOK handles monetary policy, keeps the financial system stable, and manages payments and settlements. Koh is pushing hard for the central bank to have some serious legal muscle when it comes to giving the green light to stablecoin issuers.

Stablecoins Flooding Out of South Korea

Back in May, Democratic Party lawmaker Min Byung-duk dropped a bombshell, revealing that nearly half of the cryptocurrencies sent overseas from South Korea's top exchanges in the first quarter were dollar-based stablecoins. He got the scoop from the Financial Supervisory Service's data.

Byung-duk's numbers are staggering. Between January and March, a whopping 56.8 trillion won (that's about $40.6 billion) worth of cryptocurrencies were shipped out from five major exchanges: Upbit, Bithumb, Coinone, Cobbit, and Gopax. And get this—26.87 trillion won, or a massive 47.3%, of that was in stablecoins like Tether (USDT) and USD Coin (USDC). It's like a digital exodus, and it's happening right under our noses!