South Korean presidential candidates and their supporters have clashed on the subject of stablecoins as crypto-related insurance policies proceed to dominate the political agenda.
On Might 8, frontrunner Lee Jae-myung, of the Democratic Social gathering, stated that South Korea “must create a won-based stablecoin market.”
Lee Jae-myung insisted that Seoul ought to “enter the stablecoin market shortly” or danger an “outflow of nationwide wealth.”
Korea's main conservative occasion went by way of some of the tumultuous weekends in its historical past after the occasion tried to overthrow its personal presidential candidate and failed — all inside 24 hours. https://t.co/05W70jtJKm
— The Korea JoongAng Day by day (@JoongAngDaily) Might 11, 2025
Nonetheless, his remarks drew criticism from Lee Jun-seok, the candidate for the Reform Social gathering. South Korea’s Digital Day by day quoted Lee Jun-seok as saying:
“Lee Jae-myung’s tackle economics is all the time harmful and experimental. He’s irresponsibly throwing unverified concepts round. And he repeats plausible-sounding phrases with out understanding something concerning the market.”
South Korean Presidential Candidates: Stablecoin Battle-of-Phrases
Lee Jun-seok added that South Korean buyers have already had their fingers burned with Terra’s KRW-pegged KST stablecoin. On his social media pages, the candidate wrote:
“South Korea already has expertise with a won-pegged stablecoin referred to as KRT. That very same coin was on the core of the Terra-Luna incident.”
The Terra ecosystem collapse of Might 2022 noticed the agency’s stablecoins lose their pegs. The crash wiped hundreds of thousands of {dollars} from international crypto markets.
1000’s of South Koreans have been affected. Lee Jun-seok continued:
“Terra’s KRT began out as a stablecoin pegged 1:1 to the Korean Received. However it had no actual property to again it up. As a substitute, operators tried to take care of its worth by using the extremely risky sister coin, LUNA (now LUNC). However the outcomes have been disastrous.”
The Reform Social gathering candidate defined that when market confidence collapsed, LUNC’s worth plummeted. He stated:
“All of Terra’s cash, together with KRT, collapsed. That rendered the ‘steady’ in stablecoin meaningless.”
PPP loses public belief after failed gambit to interchange presidential candidatehttps://t.co/Ms0GOwKHeC
— The Korea Instances (@koreatimescokr) Might 11, 2025
Collateral Query
Lee Jun-seok hit out at Lee Jae-myung, saying that the latter was calling for the creation of a KRW stablecoin “with out explaining what asset collateral shall be included in.”
He stated that the Democratic Social gathering candidate has not spoken about how this coin would handle market dangers to beat the “causes of previous failures.”
Lee Jun-seok, a former chief of the ruling Individuals Energy Social gathering (PPP), based the Reform Social gathering in January 2024 following his cut up from the occasion.
He has resisted calls from the PPP management, who final month requested him to rejoin the occasion as they head into subsequent month’s election.
However Lee Jae-myung’s defenders took to social media to rebut the Reform Social gathering candidate’s claims.
The previous Democratic Social gathering lawmaker Kim Byeong-wook claimed that Lee Jun-seok’s feedback have been “out of contact” with worldwide regulatory tendencies.
Kim famous that “virtually each worldwide regulator” has already dominated that “algorithm-based tokens are too risky to even be labeled as stablecoins.”
South Korean polls favor the opposition, and Lee Jae-myung received an amazing main victory in late April. Nonetheless, he faces a number of authorized costs that would preclude his candidacy, @Doug_Bandow writes. https://t.co/UnyFZQ8ALP
— Overseas Coverage (@ForeignPolicy) Might 6, 2025
He claimed that regulators all over the place from Washington to Brussels and Tokyo shared this view. Kim added:
“Buildings like these utilized by Terra are out of the query. The main target of coverage discussions is now on collateralized stablecoins backed 1:1 with money and authorities bond deposits. These cash would have real-time reserve disclosure protocols and rapid redemption obligations.”
A Battle of Phrases
Kim accused Lee Jun-seok of “lumping” algorithm-based and collateralized stablecoins collectively. The ex-DP MP stated that Lee Jun-seok’s logic was that “Terra failed, so stablecoins are harmful,” including:
“If he had solely familiarized himself with the fundamental ideas of worldwide monetary regulation, Lee Jun-seok would have averted making such a radical generalization.”
Kim argued that won-pegged tokens might assist lower abroad remittance charges and revitalize the home digital financial system.
The media outlet quoted an unnamed official from a home crypto alternate as welcoming public discourse on stablecoins and different crypto-related issues. The official stated:
“We’re seeing politicians interact in a variety of technical debates relating to digital property. These haven’t been made public till now. We’re optimistic about seeing an institutional reorganization within the crypto sector after the election.”
South Korea goes to the polls on June 3. The PPP’s candidate, Kim Moon-soo, earlier this month pledged to permit the nationwide pension and soverign wealth funds to purchase tokens like Bitcoin (BTC).
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