Kakaopay Plummets Amid Stablecoin Frenzy: Regulators Sound Alarm

Shares Crash After Rollercoaster Trading

Kakaopay's stock took a nosedive, dropping a staggering 17% on June 27 after a wild ride in the market. The Korea Exchange pulled the plug for a day, trying to cool things down after the frenzy.

From Skyrockets to Suspensions

Just days before, the stock had been on a tear, soaring 50% in two sessions. Over the past month, it's tripled in value, all thanks to the buzz about Kakaopay diving into the stablecoin game. But the Korea Exchange hit the brakes not once, but twice, because of the insane price swings. They slapped Kakaopay with an "investment risk" label, and boy, did that send shockwaves.

Reality Check Incoming?

Shawn Oh, an equities trader at NH Investment & Securities Co. in Seoul, didn't mince words: "Kakaopay was definitely overheated and went ahead of its fundamentals. Going forward, the stock will face a reality check."

Trademark Blitz Amid Legislative Moves

Kakao Pay isn't sitting still. They've filed a whopping 18 trademark applications, while their sibling, KakaoBank, is also staking its claim in the stablecoin arena with applications covering everything from crypto software to financial transactions. Brands like BKRW and KRWB are on the table.

A KakaoBank insider spilled the beans: "We submitted the trademark applications to proactively respond to developments in the stablecoin market. We will continue to carefully monitor relevant legal frameworks and market dynamics."

Legislative Push and Regulatory Warnings

The timing couldn't be hotter, with South Korea's National Assembly speeding up talks on the Digital Asset Framework Act. Once it's law, it'll greenlight won-pegged stablecoins and throw open the doors for big players like KakaoBank and Kakaopay.

But hold up—the Bank of Korea is waving red flags, warning that a flood of stablecoins could trigger chaos, from coin runs to forex market mayhem.

And it's not just them. The Bank for International Settlements is throwing cold water on the hype, saying stablecoins aren't a real replacement for traditional cash, and their future? Total mystery.