The South Korean government is accelerating efforts to introduce won-based stablecoins through a regulatory sandbox pilot program. With legislation delayed in the National Assembly, the Presidential Policy Planning Committee and financial authorities are pursuing a practical alternative: a testbed initiative under the Innovative Financial Services (regulatory sandbox) system, targeted for application within the third quarter of this year.
The pilot will likely include a consortium of banks, crypto exchanges, and fintech firms, aiming to verify the real-world feasibility of issuing, distributing, and redeeming won-backed stablecoins. Authorities see this as a strategic bypass to avoid waiting years for legal reform, while laying the groundwork for future formal adoption.
Industry players are responding swiftly. Major exchanges such as Upbit, Bithumb, and Coinone have already filed trademarks related to stablecoins and are expected to join the sandbox to gain early operational data. This pilot may also pave the way for exchanges to diversify revenue beyond trading fees, by adopting interest-bearing business models similar to Coinbase and Circle in the U.S.
However, the Bank of Korea remains cautious, citing risks to monetary stability. It has requested preconditions such as total issuance limits, regulatory oversight, and safeguards for foreign exchange market stability. Governor Rhee Chang-yong recently stated that “stablecoins are worth considering, but only under carefully managed conditions that protect the broader economy.”
Rather than a simple experiment, this sandbox is shaping up to be a critical pilot for Korea’s digital finance future. If successful, it could serve as a foundational step toward the mainstream adoption of stablecoins—well ahead of the expected enactment of the Digital Asset Basic Act around 2027.
