TLDR
- There's growing pressure on South Korea to incorporate Bitcoin into its national reserves due to increasing global cryptocurrency momentum.
- Both the Democratic Party and industry figures are suggesting the creation of a stablecoin supported by the won.
- Trump has taken significant steps by signing an executive order to initiate a Bitcoin Reserve and organized a cryptocurrency summit at the White House.
- Experts are cautioning that without a local stablecoin, Korea might lose its control over monetary policy.
- Current regulations in South Korea restrict non-residents from engaging in trading on local exchanges.
Financial experts and some political figures in South Korea are urging a move to add Bitcoin to national reserves and create a won-supported stablecoin, inspired by recent US cryptocurrency advances under Trump's leadership.
A significant forum was hosted by the Democratic Party in the National Assembly on March 6, 2025, where industry leaders debated strategies to align with global financial changes in crypto. This happened just before Trump made a pivotal move by ordering a Bitcoin Reserve.
Dive into the focal points of the summit’s discussions… pic.twitter.com/ktuXYRe1fk
— Sander Lutz (@s_lutz95) March 7, 2025
Kim Jong-seung, who heads the blockchain company xCrypton, emphasized the necessity for a definitive stance from South Korea. He pointed out that a clear policy is needed if the US includes Bitcoin in its reserve.
These discussions highlight a worldwide shift toward embracing cryptocurrency. Nations like Switzerland and Japan are leading the charge; Switzerland has turned Zug into a 'Crypto Valley,' and Japan legalized stablecoins tied to the yen in 2023.
Rep. Kim Min-seok, steering the Democratic Party’s policy committee, suggested a regulatory overhaul if the party regains power. An election may occur in May if the Constitutional Court confirms President Yoon Suk Yeol’s impeachment.
Developing a won-backed stablecoin is deemed crucial for South Korea’s financial future, as discussed in the forum. Kim Jong-seung expressed concerns over losing sovereign control in finance without a domestic alternative to USD-pegged stablecoins.
Kim suggested a transactional model that links dollar and won stablecoins. Unlike Bitcoin, stablecoins are designed to keep a consistent value by being tied to traditional assets or currencies like government bonds.
Contemplating the future of digital currencies in South Korea.
Professor Seo Eun-sook from Sangmyung University highlighted the urgency in adapting South Korea's financial strategies to global trends, noting that the US and EU are working towards systems based on stablecoins for international payments.
Kang Hyoung-goo, a professor from Hanyang University, proposed a stablecoin backed by government bonds to enhance financial security and attract international investments.
Kang mentioned that South Korea’s lack of an offshore won market is a major hurdle to joining the MSCI Developed Markets Index. A government-backed stablecoin could improve access to won-based assets worldwide.
Discussion on these points is timely, happening just before Trump’s order for a national Bitcoin reserve. By late that week, the White House held a first-ever crypto summit outlining what they called the ‘crypto Renaissance.'
The Trump administration hasn't decided about selling other reserves like gold for Bitcoin acquisition, according to David Sacks, the White House’s Crypto Czar who indicated there have been no talks yet.
Aside from Bitcoin reserves, the forum also tackled regulatory hurdles in South Korea's crypto space. Existing laws prevent non-residents from trading on domestic exchanges, diverting traders to global platforms like Binance.
Cho Jung-hee from D.Code Law Group noted concern over domestic capital moving abroad, highlighting that South Korean traders formed 13% of Binance’s trading volume in May 2023.
Min Jung with Presto Research remarked on South Korea trailing behind other nations, as corporate crypto accounts were approved only recently and Bitcoin, Ethereum ETFs are yet to be traded.
South Korea's push towards crypto adoption is driven by broader regional considerations. Michael Terpin from Transform Ventures remarked on Asia evaluating effects of trade dynamics on interest rates and liquidity.
