South Korea Delays Digital Asset Law to 2026 Over Stablecoin Disputes

South Korea's regulators have delayed the passage of a comprehensive digital asset law until at least 2026, primarily due to unresolved disputes over the issuance of stablecoins, stalling efforts to establish clear rules in one of Asia's largest cryptocurrency markets.

The Digital Asset Basic Act, intended to build on the 2023 Virtual Asset User Protection Act by addressing stablecoin licensing, reserve management, and broader investor safeguards, faced setbacks during internal negotiations. Officials from the Bank of Korea and the Financial Services Commission failed to align on key provisions, pushing back the government's submission of the bill to lawmakers. The delay, confirmed by multiple regulatory sources, reflects ongoing efforts to balance financial stability with innovation in the rapidly evolving digital asset sector.

At the heart of the disagreement is the authority to issue Korean won-pegged stablecoins. The Bank of Korea has advocated for a strict model requiring issuers to operate as consortia where banks hold at least 51 percent ownership. Bank officials argue that this structure leverages banks' established solvency standards, anti-money laundering controls, and...