Korea's Won Stablecoin Bill Stalls as Hong Kong and Japan Launch

South Korea's government bill defining who may issue a won-denominated stablecoin has still not reached the National Assembly, even as Hong Kong moved its stablecoin into retail payments on October 23 and Japan's yen coin passed its first anniversary.

HSBC launched its Hong Kong dollar-backed stablecoin, RCHKD (Red Coin), through its PayMe payment app. According to the company, wallet activation is being rolled out in stages to more than 3.3 million PayMe users, with peer-to-peer transfers and payments at about 100,000 merchants. Hong Kong's stablecoin ordinance took effect on August 1, 2025, and the first issuance licences went on April 10 to HSBC and a Standard Chartered-led joint venture, Anchorpoint.

In Japan, a revised payments law in force since June 2023 opened three routes: banks issue as deposits, fund transfer providers with redemption rights, and trust companies as trust beneficiary rights. Fintech firm JPYC issued the first yen stablecoin in October 2025. The three megabanks, MUFG, SMBC and Mizuho, plan joint-coin transactions within fiscal 2026. In the US, the GENIUS Act takes effect on January 18, 2027, and the OCC finalised its rules on October 21.

Two disputes hold up Seoul

The delay in Korea centres on two issues unchanged for over a year. The Bank of Korea wants issuance limited to consortia in which banks hold a majority stake (50% plus one share). Governor Shin Hyun-song said on October 12 that the approach would be a bank-led consortium, as agreed with the government. Democratic Party lawmaker Min Byung-duk questioned on October 22 why only banks should be considered safe issuers. The second issue is a cap on major shareholders' stakes in crypto exchanges, which the Financial Services Commission pursued and the Assembly's research service flagged twice as a possible property-rights problem.

A lawyer at Yulchon argued that bundling both topics in one law lets the exchange dispute hold up stablecoin rules. Meanwhile Hana Financial and others have formed consortia but cannot commercialise without a legal basis. On October 29, ten lawmakers led by Jung Tae-ho introduced another bill creating a licensing system for won stablecoin issuers.

The next test is whether the November subcommittee begins substantive talks. Even if the government bill arrives, it must be merged with several pending bills, so passage may slip into next year. Separately, a decision on a fourth delay of crypto income tax, due in January, remains open.