The Bank of Korea (BOK) has announced the formation of a new Virtual Asset Division, a move aimed at enhancing its oversight of the crypto market and actively participating in the development of relevant legislation. According to local reports, this new division, situated within the central bank's financial payment systems bureau, will be crucial in guiding the BOK's discussions on Korean won-based stablecoins (KRW stablecoins).
In a related development, the BOK has also renamed its Digital Currency Research Team to simply the Digital Currency Team, signaling a shift from purely theoretical exploration to more proactive initiatives in the digital currency space.
This strategic pivot by the BOK comes amidst growing momentum for stablecoin discussions in South Korea, partly influenced by U.S. advancements in endorsing USD-backed stablecoins. South Korean President Lee Jae-myung has publicly committed to promoting a local currency-based stablecoin market to prevent capital flight, and a ruling party lawmaker has already introduced a bill to establish a regulatory framework for KRW stablecoins.
The private sector has mirrored this interest, with major South Korean banks and payment service providers filing trademark applications for stablecoin ticker symbols. While the BOK previously paused its Central Bank Digital Currency (CBDC) project due to the progress of stablecoins, Governor Lee Chang-yong has expressed the need for KRW stablecoins, though he has cautioned against allowing non-banking institutions to issue them, citing potential market disruption.
July 2025, Cryptoniteuae