The 21st-century global economy is currently engaged in two simultaneous currency wars. One is the visible battle over interest rates and exchange rates, while the other is a quiet struggle for dominance in digital currencies on the blockchain. In the past, countries with oil held sway over the global order; now, nations that control digital payment networks and stablecoins are poised to lead the future financial landscape.
A recent policy symposium at the Global Finance Conference in Seoul symbolically highlighted these changes. The forum, themed 'The Spread of Token Securities (STO) and Stablecoins and Changes in Financial Economics,' was not merely a discussion on virtual assets; it resembled a national strategy meeting questioning the future survival of Korean finance.
Professor Lee Jong-seop's remarks were particularly significant. He asserted, 'The time for discussing whether to adopt stablecoins has already passed.' He warned that countries that delay action risk becoming mere consumers following the order set by others.
Currently, the market capitalization of dollar-based stablecoins has surpassed $300 billion. While this figure is still small compared to the global foreign exchange or U.S. Treasury markets, its growth rate is outpacing traditional financial systems.
What matters is not just the amount. Dollar stablecoins have evolved into a core infrastructure for international remittances, online payments, and digital asset transactions.
The United States does not view this as a mere private industry. Through dollar-based stablecoins, it aims to establish a 'new Bretton Woods system' for the digital age. Just as the petrodollar era was initiated by tying oil payments to the dollar, analysts suggest that a digital dollar system on the blockchain is being developed.
Tokenizing U.S. Treasury bonds is particularly symbolic. If U.S. Treasury bonds are traded in real-time on the blockchain, allowing global investors to access U.S. assets through dollar stablecoins, the dollar-centric structure in the digital financial market will be further reinforced. Ultimately, stablecoins are not just coins; they represent a new technological facade of U.S. financial hegemony.
The challenge lies for countries like South Korea, which are not reserve currency nations. If global digital payments are reorganized around dollar stablecoins, the international influence of the won could diminish significantly. As Korean companies and consumers engage more in the global digital market, they may become increasingly dependent on the dollar ecosystem.
This is why Professor Lee emphasizes the need for a Korean model. His core argument is straightforward: create an 'expansive structure' based on central bank digital currencies (CBDCs) and bank deposit tokens, allowing the private sector to develop various won-based stablecoin services.
This model is meaningful because it reflects the realities of the Korean financial market. South Korea is neither a dollar hegemon like the U.S. nor a country with a strong capital control system like China. However, it possesses world-class IT infrastructure, a mobile payment culture, and a robust content industry.
Ultimately, South Korea's battleground is not 'reserve currency' but 'digital ecosystem.'
This is where the significance of K-content emerges. BTS, K-pop, webtoons, games, dramas, and online fandoms have already formed a global consumption ecosystem that transcends borders.
Young people around the world are consuming Korean content and connecting with Korean culture. If this consumption flow is linked to a won-based digital payment network, the situation could change.
For instance, if global fans use won-based stablecoins for music purchases, concert tickets, webtoon payments, and game item transactions, it would expand the digital financial ecosystem beyond mere content exports. This could ultimately increase demand for the won and expand the need for won-based deposits and Treasury bond collateral.
This structure could also provide new vitality to the Korean capital market. Stablecoins fundamentally require collateral assets to maintain stability, necessitating safe and liquid assets.
Consequently, demand for deposits, Treasury bonds, and high-quality short-term bonds is likely to increase.
This could enhance the liquidity and depth of the entire Korean financial market, going beyond merely fostering the virtual asset industry. It could also positively impact the internationalization of the Treasury bond market and the activation of the token securities (STO) market.
The recent Global Finance Conference policy symposium is significant not only as an academic event but also as a signal of a shift in Korean financial policy direction. Just a few years ago, Korean financial authorities tended to view virtual assets solely as speculative targets. However, the world is beginning to recognize stablecoins as the next-generation financial infrastructure.
Major financial hubs, including the U.S., Europe, Singapore, Hong Kong, and the UAE, are moving toward a dual approach of regulation and support. The strategy is not to block digital assets but to bring them into the regulatory framework.
In the U.S., there is an effort to strengthen digital dollar hegemony through dollar stablecoins, while Europe aims to build a euro-based digital payment ecosystem. Singapore is pursuing a global digital asset hub strategy, and Hong Kong seeks to serve as a digital financial gateway connected to mainland China.
If South Korea falls behind, it risks losing not just its blockchain industry competitiveness but also the possibility of being relegated to a peripheral country in future global payment networks and capital flows.
The most significant takeaway from this forum is that stablecoins are now viewed as a 'financial order issue.' They are no longer just cryptocurrencies but part of a massive structural change connected to international finance, payment systems, Treasury bond markets, digital trade, and platform economies.
Currently, stablecoins are broadly categorized into four types:
- Fiat-backed: Issued against collateral such as U.S. dollars, Treasury bonds, or deposits. This type is the most stable and currently dominates the market.
- Crypto-backed: Collateralized by cryptocurrencies like Bitcoin or Ethereum. While it offers decentralization, it has significant price volatility.
- Algorithmic: A structure that maintains value by adjusting supply through algorithms. However, past large-scale collapses have raised trust issues.
- Central Bank Digital Currency (CBDC) linked: Based on central bank trust and connected to private payment systems.
Most major countries are focusing on the first and fourth models. The U.S. is combining private stablecoins with the Treasury bond market, while China is building a state-controlled model centered around the digital yuan.
The key takeaway for South Korea is to prioritize 'ecosystem strategy' over technology. Unlike the U.S., South Korea does not have dollar hegemony, nor does it possess the strong state control seen in China. Instead, it has competitive strengths in content and platforms.
Therefore, South Korea must build a unique model that integrates finance, culture, and platforms. This involves not just creating coins but connecting K-content consumption with digital payments and linking this to token securities and capital market innovations.
The future of a Korean won stablecoin ultimately hinges on K-content and the platform economy.
South Korea wields significant influence in global cultural content. K-pop, dramas, webtoons, and games have already shaped a global digital consumption culture. If a won-based digital payment system is integrated, South Korea could evolve from a mere content-exporting country to a digital cultural and financial platform nation.
To achieve this, the role of policymakers is crucial.
First, a clear regulatory framework must be established. Uncertainty poses the greatest risk. It is essential to promptly establish issuance criteria for stablecoins, collateral regulations, and consumer protection systems.
Second, a collaborative ecosystem among banks, fintech companies, and content platforms must be fostered. The financial and cultural industries cannot thrive in isolation.
Third, capital market innovations linked to the token securities (STO) market are necessary. If Treasury bonds, corporate bonds, and content IP can be tokenized, the structure of the Korean capital market itself could change.
Fourth, international cooperation strategies are also vital. Particularly, a strategy to expand a won-based digital payment network in the Asian market is needed.
Ultimately, stablecoins are not just virtual currencies. They represent a question of which nation will dominate the platform in the future digital civilization order.
South Korea stands at a critical crossroads. If the new experiment connecting K-content and digital finance succeeds, the won may evolve from a minor non-reserve currency to a significant connecting currency in the Asian digital economy.
* This article has been translated by AI.
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