TechFlow news, October 28 — According to Yonhap News Agency, South Korean People Power Party lawmaker Park Sung-hoon will submit a bill proposing amendments to the Foreign Exchange Transaction Act, aiming to include stablecoins within the legal definition of payment methods. The bill seeks to revise Article 3, Paragraph 1 ("Definitions") to list stablecoins alongside government-issued banknotes, bank drafts, and coins as recognized means of payment.
Lawmaker Park stated that although stablecoins pegged to fiat currencies are increasingly recognized as potential new payment instruments, their distinct nature compared to traditional legal tender has left them unclassified as payment methods under the current Foreign Exchange Transaction Act. This regulatory gap could enable illegal foreign exchange transactions and tax evasion through stablecoin usage.
The Bank of Korea previously voiced similar concerns, noting that U.S. dollar-denominated stablecoins could be used in cross-border current and capital account transactions without complying with the reporting requirements stipulated by the Foreign Exchange Transaction Act. It also warned that the growing use of stablecoins may facilitate illicit activities circumventing foreign exchange regulations. The Ministry of Economy and Finance expressed support for the proposed legislation, stating it is currently coordinating with relevant agencies, including the Financial Services Commission and the central bank, to develop specific regulatory measures.
