Bank of Korea Forms Virtual Asset Unit to Oversee Crypto and Stablecoin Regulations

Jimmy Aki
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The Bank of Korea (BOK), South Korea’s central bank, has formed a dedicated virtual asset team within its Financial Payments Bureau to regulate the growing cryptocurrency and stablecoin market.

This move comes as digital markets expand rapidly, requiring better oversight of systemic risks and policy development.

New Unit Will Analyze Potential Market Risks

According to a July 29 report by local outlet News1, the Bank of Korea’s newly formed virtual asset unit will track developments in the crypto industry, assess potential financial stability risks, and actively contribute to policy frameworks.

Alongside the launch of the virtual asset unit, the Bank of Korea has restructured several internal teams to accelerate development.

The country’s CBDC research unit, known as the Digital Currency Research Team, has now been rebranded to the Digital Currency Team. The department will transition from theoretical study to active development and implementation of crypto systems.

Two additional teams have also been realigned. The Digital Currency Technology Team will lead technical research and investigation into digital currency systems.

Meanwhile, the Digital Currency Infrastructure Team will focus on building platforms, including a system for managing digital vouchers based on deposit tokens and a broader testing environment for future deployments.

This decision follows similar regulatory steps globally, including Pakistan’s May 2025 establishment of the Pakistan Digital Assets Authority (PDAA), to oversee blockchain-based financial systems.

The agency plans to regulate every part of the crypto space, such as licensing requirements, trading platforms, digital wallets, custodians, tokenized assets, stablecoins, and decentralized finance tools.

https://twitter.com/PakStartup/status/1925265434976133411

CBDC Rollout Slows as Focus Shifts Toward Stablecoins

The regulatory advancement from the BOK coincides with last month’s decision to delay its central bank digital currency (CBDC) pilot program.

Initially set for a limited launch in late 2025, the CBDC would have enabled peer-to-peer payments and everyday merchant transactions.

But the plan has faced several challenges, including high operational costs and unclear commercialization pathways, which have forced a reassessment.

Instead, the Bank of Korea is now prioritizing oversight of Korean won-pegged stablecoins.

Under the Digital Asset Basic Act, companies must hold at least 500 million Korean won (about $370,000) in equity, maintain sufficient reserves, and follow strict consumer protection rules. Licensing will be mandatory.

South Korean lawmakers are actively interested in passing the bill as it undergoes the standard legislative process and review. The urgency follows an increase in U.S. dollar-backed stablecoin transactions in South Korea.

In Q1 2025 alone, over 57 trillion Korean won (nearly $42 billion) was traded using those assets.

Policymakers believe that a domestic stablecoin regime, anchored by the Korean won, is a necessary tool to preserve monetary sovereignty.

Globally, the stablecoin market has exploded. Now valued at $266 billion, it is dominated by U.S.-based tokens. South Korea wants a piece of that future, on its terms.

Other nations are thinking along similar lines. In the UAE, Abu Dhabi institutions announced a fully regulated Dirham-pegged stablecoin under the oversight of the UAE central bank.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.