South Korea delays the legislative process of the second phase of the Virtual Asset Act due to disputes over stablecoin terms

The legislative process of South Korea's second phase of the Virtual Assets Act has been delayed due to disputes over key provisions. The bill aims to comprehensively regulate digital assets, including stablecoins. The controversy mainly focuses on whether the qualifications for issuing Korean won stablecoins (banks or authorized enterprises) and the financial and virtual asset business isolation restrictions should be relaxed. In addition, the bill proposes to set a 15% -20% upper limit on the shareholding of major shareholders in the exchange, which has been criticized as too strict. The delay in legislation has led to the suspension of discussions on spot virtual asset ETFs and related issues, while negotiations between the government, industry, and political groups are still ongoing.