Bank of Korea (BOK) Governor Lee Chang-yong issued a cautionary statement Wednesday regarding the potential effects of issuing Korean won-pegged stablecoins, warning that such efforts might unintentionally increase demand for U.S. dollar-backed stablecoins.
“Issuing won stablecoins may not reduce the use of dollar stablecoins, but rather facilitate the exchange between dollar stablecoins and won stablecoins, which may increase the demand for dollar stablecoins,” Lee said during a press briefing.
Lee emphasized that this shift could complicate foreign exchange oversight and undermine efforts to reduce reliance on the dollar in digital financial ecosystems.
Tension Between Central Bank and Presidential Vision
The BOK governor’s concerns appear to conflict with the new South Korean President Lee Jae Myung’s pro-stablecoin agenda, which includes promoting KRW-backed stablecoins as a tool to prevent capital flight and support sovereign control in a digitized financial future.
While Lee Chang-yong acknowledged the utility of KRW stablecoins, he stressed the importance of robust risk controls and regulatory measures to avoid unintended macroeconomic consequences.
“The central bank does not oppose the issuance of won stablecoins,” he clarified, “but these must be approached carefully with appropriate safeguards in place.”
As South Korea explores digital currency innovation, the diverging views between the central bank and the executive branch highlight a broader challenge: balancing innovation with financial sovereignty and stability in an increasingly borderless digital asset landscape.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/south-koreas-central-bank-warns-won-stablecoins-could-boost-dollar-demand/