South Korea is aggressively moving to finalize the legal framework for stablecoins as part of its 'Phase 2' Digital Asset Law. The central contention is a regulatory battle between established financial institutions, which demand strict oversight to preserve stability, and the blockchain industry, which champions stablecoins for innovation, particularly in cross-border settlements.

Lawmakers are aiming to pass the Virtual Asset Basic Act this month, and the resulting licensing criteria will crucially determine whether Korea's stablecoin regime fosters genuine financial innovation or merely strengthens the control of traditional finance.

This domestic struggle is key to the future direction of Korea's digital finance ecosystem.

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