A new policy report from Hashed Open Research and the Solana Policy Institute, published on Wednesday, recommends that South Korea should allow greater flexibility for stablecoin issuers. The document also suggests providing interim licensing guidance and phasing in stablecoin regulation before the country's Digital Asset Basic Act is completed.

The report's findings consolidate discussions from a symposium that took place on June 23, which was attended by a group of lawmakers, legal experts, and industry participants.

The forthcoming Digital Asset Basic Act is intended to be South Korea's first comprehensive legal framework for digital assets. It will establish rules covering stablecoins, issuance protocols, disclosures, and market conduct. However, the legislation has been delayed as lawmakers work to reconcile multiple bills, with disagreements centered on the specifics of stablecoin issuance.

According to Democratic Party lawmaker Ahn Dogeol, policymakers are exploring a compromise. This potential solution would see banks hold majority ownership in stablecoin ventures, while fintech and non-bank companies would be responsible for managing operations.

Kim Hyobong, a partner at the law firm Bae, Kim & Lee, contributed to the discussion by highlighting several areas requiring clarity. He argued that South Korea must specify which crypto-related activities financial institutions are permitted to undertake, resolve the current licensing uncertainty for stablecoin payments, and formulate rules for stablecoins that are issued abroad.

Additionally, Kim urged the nation to follow the example set by the European Union's phased rollout of its Markets in Crypto-Assets Regulation (MiCA). He proposed that South Korea could introduce rules for stablecoin issuance ahead of passing the full Digital Asset Basic Act.