Key facts
- South Korea recorded $367 million in net stablecoin outflows in June.
- This is the 18th consecutive month of net stablecoin outflows from the country.
- The outflows are linked to demand for offshore derivatives, tokenized RWAs, and DeFi products.
- Lawmaker Lee Jong-wook urged the government to improve investor protection and supervision of cross-border crypto activities.
- South Korea is developing a comprehensive digital asset framework, including proposed stablecoin regulations.
South Korea experienced net stablecoin outflows totaling $367 million in June, extending a streak of such activity to 18 consecutive months. Data from the Financial Supervisory Service (FSS), obtained by Yonhap News Agency, revealed that South Korea's five major crypto exchanges transferred 2.7 trillion won ($1.81 billion) offshore while receiving 2.2 trillion won ($1.44 billion) from foreign platforms.
Market participants attributed these outflows to demand for products not available on domestic exchanges, including overseas derivatives, tokenized real-world assets (RWAs), decentralized finance (DeFi), and staking products. Lawmaker Lee Jong-wook has urged the government to reassess its investor protection and supervisory frameworks for cross-border crypto activities.
These outflows occur as South Korea works to establish a comprehensive digital asset framework. A recent policy report recommended interim licensing guidance and phased stablecoin regulations before the finalization of the Digital Asset Basic Act. The proposed act aims to regulate stablecoin issuance, disclosures, and market activity, though disagreements over won-pegged stablecoin issuers have caused delays. Additionally, the Financial Intelligence Unit (FIU) proposed extending Travel Rule reporting requirements to smaller transactions and called for stronger action against unregistered overseas exchanges.