- South Korea’s central bank built a crypto unit to monitor the growing digital asset market.
- The new team will focus on stablecoins and help design rules with lawmakers and banks.
- This move may guide other countries in Asia to manage crypto rules at the bank level.
The Bank of Korea (BOK) has launched a dedicated virtual asset division under its Financial Payment Systems Bureau to monitor crypto markets. According to local outlet News1, it should also oversee Korean won stablecoin activity and participate in legislative dialogue. This move comes as the government accelerates plans to legalize domestic stablecoins, prompting BOK to pause its central bank digital currency (CBDC) rollout and restructure its internal digital currency teams.
The newly formed division, known as the Virtual Asset Team, will focus on real-time market monitoring and formal discussions around crypto legislation. It will also support coordination with government bodies involved in shaping digital currency policies. The team is expected to serve as the bank’s primary body for stablecoin oversight. The BOK has simultaneously rebranded and reorganized its internal digital currency units to transition from theoretical research to business-oriented development.
Internal Restructuring Marks Strategic Shift
Effective July 31, the Digital Currency Research Lab within the BOK’s Financial Settlement Bureau was renamed the Digital Currency Lab, a move interpreted as a shift from academic analysis to practical application. The removal of the word “research” reflects the central bank’s desire to function more like an operational division with a direct stake in policy execution.
The lab is now divided into two core teams. Team 1, now the Digital Currency Technology Team, is assigned responsibilities for privacy-protection technologies and digital currency investigations. Team 2 has been renamed the Digital Currency Infrastructure Team, tasked with developing a voucher management platform based on deposit tokens and building systems to test usability.
These changes align with BOK’s evolving stance on deposit tokens. The central bank sees them as interchangeable with stablecoins issued by traditional banks, particularly in function and design. Governor Rhee Chang-yong has previously described deposit tokens as “stablecoins issued by banks.” In early July, he stated that the country will “carefully consider whether to focus on bank-led deployment or allow expansion to private players.” This restructuring enables BOK to take a central role in building systems for token issuance, legislative input, and compliance with future regulatory frameworks.
Stablecoins Take Center Stage in National Debate
The BOK’s updated approach coincides with South Korea’s rising interest in legalizing won-backed stablecoins. The momentum stems from government-level initiatives and public sector interest in capital flow control and payments modernization.
President Lee Jae Myung, elected recently, pledged to foster a strong KRW-backed stablecoin ecosystem as a measure to prevent capital flight. In response, a ruling party lawmaker submitted a bill designed to create a foundational legal structure for Korean stablecoins.
Meanwhile, South Korea’s top banks and fintech companies have already filed trademark applications for stablecoin ticker symbols, implying private-sector interest. This flurry of activity compelled the BOK to take a pause from pushing its own CBDC initiatives any further, seemingly preferring to collaborate rather than compete with commercial banks’ stablecoin initiatives. It also probably stems from the BOK realizing that bank-issued deposit tokens and stablecoins share the same fundamental infrastructure.
Related: South Korea Warns Asset Managers to Cut Exposure to Crypto ETF Holdings
Will Asia Follow South Korea’s Lead?
This is one of the first instances in Asia where a central bank steps in for direct stablecoin supervision, rather than pure financial regulators. This marks a shift in regulatory structure, where oversight is now shared between central banks and fintech regulators, rather than left solely to financial authorities.
Japan, Singapore, and other Asian economies are likely to follow South Korea’s lead in implementing similar frameworks. The split system could arise in the region as a useful standard to protect monetary policy, yet encourage innovation in cross-border payments and stable digital instruments. Given the pace of development and the involvement of the South Korean government, the country may well emerge as the benchmark clearinghouse for stablecoin governance structures across Asia.
