South Korea bill would bring stablecoins, tokenized RWAs under law

A recent draft bill circulated by South Korean lawmakers would place stablecoins and tokenized real-world assets under the country’s finance law, bringing those tokens into the nation’s financial regulatory framework.

The draft targets two types of digital tokens. Stablecoins are defined as tokens that aim to maintain a stable value, typically linked to fiat currency or other assets. Tokenized real-world assets, or RWAs, represent ownership or claims on physical assets such as real estate, bonds or commodities.

Under the proposal, issuers, intermediaries and trading platforms that handle these tokens would fall inside the regulated perimeter. The draft would require entities that issue or operate services for stablecoins and tokenized RWAs to register or obtain licenses, implement anti-money-laundering and know-your-customer controls, and meet reporting and disclosure obligations.

On stablecoins, the draft would require issuers to maintain adequate backing or reserve arrangements to meet redemptions and to provide transparency on the composition and custody of reserves. For tokenized RWAs, the bill would clarify how ownership and transfers are recorded and how custody, settlement and insolvency should be handled for tokenized holdings.

The proposal names likely affected market participants, including fintech firms that issue tokens, cryptocurrency trading venues, custodial service providers and financial institutions integrating tokenized products into investment or lending. Service providers that facilitate issuance, trading or custody would be subject to controls comparable to those for traditional financial firms.

The draft leaves technical details to secondary rules. Regulators expect to issue guidance on areas such as capital and liquidity requirements for issuers, audit and disclosure standards for reserve holdings, and cross-border rules for tokenized assets if the bill advances.

South Korea has been developing rules for virtual assets in recent years with a focus on consumer protection and financial stability. The country also introduced disclosure rules for crypto influencers. The draft bill represents the latest legislative effort to place emerging digital asset structures within established financial supervision.