Catenaa, Tuesday, July 01, 2025-South Korean equity markets soared this week after newly elected President Lee Jae-myung pledged strong support for won-backed stablecoins, triggering investor euphoria across crypto-linked stocks.
The Kospi index surged nearly 30 percent year-to-date, marking its best performance in four years and positioning it as Asia’s top-performing market for the first half of 2025.
Retail investors flooded into companies seen as poised to benefit from a stablecoin-friendly environment.
Kakao Pay more than doubled in value, while LG CNS rose nearly 70 percent before modest corrections. In the junior Kosdaq market, ME2ON tripled after launching a dollar-pegged stablecoin through a casino-focused subsidiary, and fintech security firm Aton saw an 80 percent spike.
Fueling the optimism was President Lee’s appointment of Kim Yong-beom, a digital asset advocate, as chief policy adviser.
A legislative proposal from the ruling party would allow firms with as little as 500 million won in equity to issue stablecoins, igniting further interest.
Despite the surge, clear regulatory details are still pending. Concerns persist that looser requirements could enable undercapitalized firms to enter the space, potentially exposing the financial system to instability.
Bank of Korea Governor Rhee Chang-yong has warned against non-bank stablecoin issuers, citing risks to monetary policy and capital control.
Meanwhile, the Financial Services Commission has presented a roadmap for spot crypto ETFs and stablecoin oversight to the Presidential Committee, hinting at broader crypto reform in the second half of 2025.
