Korea crypto regulation delayed: won-stablecoins and exchange caps hit limbo

Korea crypto regulation is set to slip further after Korea’s National Policy Committee postponed the “second‑phase” Digital Asset Framework Act debate until after the June 3 local elections. The bill was removed from the March 31 agenda, leaving key rules for Korea’s crypto market in limbo, with only a partial user‑protection amendment advancing. The delay keeps two flashpoints unresolved. For won-stablecoins, the Bank of Korea backs a bank‑led issuance model requiring banks to hold at least 51% of the issuer. The Financial Services Commission (FSC) pushes back, warning a hard 51% cap could sideline fintechs, tech platforms, and exchange-linked parties—so new and existing issuers remain in a gray zone. On exchange governance, the FSC is moving toward tighter ownership limits for major shareholders (around a 20% ceiling with exceptions). If implemented, incumbents such as Upbit and Bithumb may need to cut stakes during a transition period, reshaping control and potentially affecting deals and listings. For traders, the immediate effect is higher uncertainty rather than instant policy clarity. Expect tougher-to-model liquidity and listing plans for Korean venues, wider risk premia around KRW product narratives, and potential repricing after the election—depending on whether policy shifts toward “bank-heavy” issuance and restrictive governance or a more permissive framework.