South Korea has officially made the development of the digital asset ecosystem a national priority for the next five years. The Presidential Policy Planning Committee included this as one of the 123 policy tasks of the Lee Jae-myung government.
The committee listed "Building a Digital Asset Ecosystem" under the "World-Leading Innovative Economy" agenda. The Financial Services Commission is set to oversee this initiative, but specific implementation details have not been disclosed.
Policy Promise Remains Vague
Currently, only the titles of all policy tasks are public, leaving the entire society, including the cryptocurrency industry, speculating. Observers can infer the direction from President Lee Jae-myung's election promises, which included allowing spot ETFs, legalizing security tokens, and creating won-based stablecoins for domestic use.
However, significant uncertainty remains about how these policies will be implemented. The Financial Services Commission's leading role raises questions within government restructuring plans. The Policy Planning Committee previously considered splitting this organization, but the current status is unclear.
Moreover, this "Digital Asset Ecosystem" was not included in the 12 specially emphasized priority strategic tasks. The committee highlighted AI industry development, supporting the Korean stock market, and expanding global soft power as key initiatives.
Typically, the presidential transition committee prepares national policy tasks before a new government takes office. However, President Lee Jae-myung's government, which won the June 3rd election and was immediately inaugurated, had to form the Policy Planning Committee to determine policy tasks. This was due to the exceptional situation following the failed impeachment of President Yoon Suk-yeol in December last year.
Legislative Issues May Delay Implementation
Another critical uncertainty lies in the complex legislative process of implementing comprehensive digital asset policies. ETFs, security tokens, and stablecoins require a new comprehensive digital asset law that goes beyond current regulations. The industry has been waiting for "second-stage legislation" since the user protection law was implemented last July.
A digital asset bill submitted by ruling party lawmakers in June is already in the legislative process but has not been actively discussed. The path ahead may be relatively smooth as the ruling party holds a comfortable majority, and the presidential candidate of the largest opposition party also supported cryptocurrency development during the election period.
However, the 123 tasks require establishing or modifying 951 laws and regulations nationwide. The government plans to submit 87% of the necessary legislative amendments to the National Assembly by next year. Given this vast legislative work, it may be unrealistic to expect digital asset legislation to receive top priority.
Regional Competition Drives Policy Urgency
With the GENIUS bill passing in the United States, dollar-based stablecoin adoption has accelerated globally. This has raised concerns about potential monetary sovereignty infringement due to the spread of dollar stablecoins worldwide, including in South Korea.
As competition intensifies among potential digital finance hubs in Asia, South Korea faces pressure to accelerate policy development. Japanese companies have begun building digital asset reserves, Hong Kong recently implemented a comprehensive stablecoin law, and Singapore has become one of the most crypto-friendly places by issuing twice as many cryptocurrency exchange licenses in 2024 compared to the previous year.
Future legislative discussions in South Korea are expected to focus on stablecoin regulation. Gradual allowance of corporate accounts, ETFs, and the introduction of leverage products on domestic cryptocurrency exchanges will be part of the discussion.
South Korean cryptocurrency investors are known for their high-risk tolerance. Upbit, South Korea's main cryptocurrency exchange, currently ranks 4th in fiat currency trading volume but can only be used by Korean nationals.
As of May 2025, South Korea has approximately 9.7 million virtual asset users, with over 20 million accounts registered on major exchanges and wallet services. The user base will grow further when corporate cryptocurrency trading is permitted and investor protection is enhanced to traditional financial market levels.
