BOK chief says he is not against won-based stablecoins but has forex concerns
SEOUL :South Korea's central bank governor said on Wednesday he was not against issuing won-denominated stablecoins but had concerns about managing capital flows.
"Issuing won-based stablecoin could make it easier to exchange them with dollar stablecoin rather than working to reduce use of dollar stablecoin. That in turn could increase demand for dollar stablecoin and make it difficult for us to manage forex," Rhee Chang-yong told a press conference in Seoul.
Stablecoins, a type of cryptocurrency designed to maintain a constant value – typically pegged 1:1 to the U.S. dollar – are widely used by crypto traders to move funds between tokens, and are starting to be adopted by more and more companies.
Regulators in many countries are skeptical about cryptocurrencies as they are seen as speculative and as competitors to national currencies.
Rhee's comments come as South Korea's left-leaning President, Lee Jae Myung, is seen delivering on his election pledge to allow companies to issue won-based stablecoins.
The ruling Democratic Party proposed earlier this month the Digital Asset Basic Act, designed to set up regulatory infrastructure needed to help local companies issue won-denominated stablecoins.
President Lee appointed a former crypto firm chief, Kim Yong-beom, as his chief policy officer in his first week in office, further boosting speculation that the government would take action to allow issuance of stablecoins backed by the Korean won.
Kim has previously served as vice chairman of the Financial Services Commission before becoming chief executive of Hashed Open Research, a think tank affiliated with crypto venture capital firm Hashed Ventures Inc.
Governor Rhee has previously told reporters that allowing stablecoins to be issued by local companies, rather than the central bank, could significantly undermine the effectiveness of monetary policy and capital flow control.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
-2.jpg%3Fitok%3DdQeiGCso&w=3840&q=100)
CNA
2 hours ago
- CNA
Work It - After your company acquires another, how can you manage the changing team dynamics?
Work It Your company has acquired an international firm, and you've been assigned to train the incoming staff. How do you approach the situation with sensitivity? Have a work-related question to ask a career counsellor? Email us at cnapodcasts [at]
CNA
2 hours ago
- CNA
HSBC names Asia veteran Christopher Chua global M&A head
HONG KONG :Europe's biggest bank HSBC appointed Christopher Chua head of mergers and acquisitions on Wednesday, after its former global head left for JPMorgan last month. Chua, who was most recently the bank's Asia head of M&A, will take up the new role immediately and continue to be based in Hong Kong, according to a memo seen by Reuters and confirmed by a company spokesperson. He will lead the M&A business in "Asia and the Middle East, an area of competitive strength where we provide significant value to our clients", Adam Bagshaw, the bank's global head of capital markets and advisory said in the memo. Chua is the latest top banker to be promoted to oversee reconfigured dealmaking business at the Asia-focused bank, which started a global overhaul last year that left the operation more focused on M&A and equity capital market capabilities in Asia and the Middle East. The bank wound down its M&A and some equities businesses in Europe and the Americas earlier this year and its former global M&A head Kamal Jabre's left for U.S. rival JPMorgan. Chua, who joined HSBC in 2022 from Credit Suisse to lead its M&A business in Asia, has more than 20 years' experience advising international blue-chip companies on complex cross-border M&A transactions. Meanwhile, Vikas Seth will chair the M&A business at HSBC, in addition to his role as vice chair for corporate and institutional banking that focuses on strategic client engagement.
CNA
2 hours ago
- CNA
Four islands off Sumatra belong to Aceh, Prabowo rules, ending province's dispute with North Sumatra
JAKARTA: Indonesia President Prabowo Subianto has ruled that four contested islands off the northwestern coast of Sumatra belong to Aceh, putting an end to the province's long-running dispute with neighbouring North Sumatra. The Indonesian government decided the islands of Lipan, Panjang, Mangkir Gadang and Mangkir Ketek were administratively part of Aceh province after a limited Cabinet meeting led by the president on Tuesday (Jun 17). The islands had been at the centre of a bureaucratic tug-of-war between Aceh – a special autonomous province with broader self-governing powers than other provinces – and North Sumatra after a recent ministerial decree listed them as part of Central Tapanuli regency in North Sumatra. The decree, issued on Apr 25, prompted protests and renewed scrutiny of the islands' rightful status. Home Affairs Minister Tito Karnavian clarified on Tuesday that Prabowo's decision was grounded in official documents dating back over three decades. Among them was a 1992 decree that unambiguously placed the four islands within the jurisdiction of Aceh's Singkil regency. 'We found an original document from Nov 24, 1992 – yellowed with age but still intact – that clearly includes the islands as part of Aceh. It was compelling enough for us to prepare formal records confirming its authenticity,' said Tito. Prabowo's decision followed joint consultations with the governors of both affected provinces. Aceh governor Muzakir Manaf and North Sumatra governor Bobby Nasution both participated in the virtual meeting and signed a formal agreement recognising Aceh's administrative claim to the islands. Muzakir welcomed the decision, saying it brought clarity to an issue that had caused unnecessary tension. 'This should settle everything. No party is at a loss here, and most importantly, the islands remain under the sovereignty of the Republic of Indonesia,' he said. Bobby echoed the sentiment, urging residents of both provinces to avoid divisive rhetoric. 'Aceh is our neighbour. Let's not be swayed by provocations or misinformation. What matters most is unity,' said Bobby, who is also the son-in-law of former President Joko Widodo. According to news outlet Jakarta Globe, a survey conducted in 2022 found the islands to be uninhabited. But they contain cultural and religious markers such as graves and monuments erected by the Aceh government. Lipan island is mostly submerged due to rising sea levels, news outlet Tempo reported. Panjang is the largest of the four islands with an area of 45.81 hectares, the size of about 45 football fields. Mangkir Ketek has an area of 6.36 hectares while Mangkir Gadang's area is 7.48 hectares. They are 1.2km to 2.4km from mainland Sumatra, Tempo reported. The dispute over the islands has attracted heightened attention in recent years, partly due to their strategic and economic potential. They are near the Offshore West Aceh oil and gas block currently operated by Conrad Asia Energy, which has estimated gas reserves of 296 billion cubic feet, reported Jakarta Globe. They are also near the Offshore North West Aceh block, which is believed to hold vast energy resources. Muzakir said the islands are also believed to hold valuable reserves of natural gas.
