Stablecoin Giants Eye South Korean Banking Partnerships

Executives from leading stablecoin providers, Tether and Circle, are reportedly scheduled to engage with key decision-makers at South Korea’s premier banking institutions this week, according to sources within the country.

Yonhap, South Korea’s national news agency, announced on Thursday that representatives from both Tether and Circle are expected to meet with senior leadership from the nation’s four largest banking conglomerates. Discussions are anticipated to center around prospective collaborations, the potential for introducing stablecoins pegged to the Korean Won, and strategies for circulating stablecoins backed by the US dollar within the South Korean market. Understanding stablecoins is crucial in this context.

Reports indicate that Shinhan Financial Group’s CEO, Jin Ok-dong, and Hana Financial Group’s CEO, Ham Young-joo, have meetings scheduled with Circle’s president, Heath Tarbert, on Friday. Young-joo is also expected to meet with a representative from Tether on the same day.

Furthermore, KB Financial Group’s chief digital and information technology officer, Lee Chang-kwon, and Woori Bank’s president, Jeong Jin-wan, are also slated to meet with Circle’s Tarbert, though the exact timing remains undisclosed. These banks comprise South Korea’s “Big Four” financial institutions, recognized by the Financial Services Commission as systemically vital domestic banks per their designation.

South Korea Gears Up for Stablecoin Regulations

This news comes after reports earlier this month indicating South Korea’s preparations to establish a regulatory structure for a stablecoin backed by the Korean Won. The Financial Services Commission, South Korea’s regulatory body, is expected to introduce the bill as part of the second phase of its Virtual Asset User Protection Act.

In early July, shares of several leading South Korean bank stocks experienced a surge following trademark filings related to stablecoins. Subsequently, the banking division of South Korean IT giant Kakao Corporation declared its intention to actively “participate” in the stablecoin market.

South Korea’s shift in focus toward stablecoin regulation follows the suspension of central bank digital currency (CBDC) trials in late June. This pause allows for increased emphasis on supporting stablecoins pegged to the Korean Won instead, see more on the focus on won-backed stablecoins. Prior to this development, eight prominent South Korean banks were planning a collaborative effort to launch a stablecoin tied to the local currency by the next year.

Related: Bank of Korea to Launch Virtual Asset Committee to Monitor Crypto

Just the Latest in a String of Important Meetings

These meetings in South Korea represent the latest in a series of high-level discussions involving Tether and Circle, as global regulators work towards establishing clearer guidelines for stablecoins.