South Korea to Prohibit Interest Payments on Payment Stablecoins

According to PANews, South Korea's Financial Services Commission Chairman, Lee Eui-yeon, announced on October 20 that interest payments on payment stablecoins, resulting from holding or usage, will not be permitted in principle. This statement was made during a national audit session in the National Assembly. Lee highlighted that South Korea will adhere to the principles outlined in the U.S. Genius Act to prohibit such activities. He also mentioned exploring a bank-led alliance model, which would restrict fintech companies to technical partnership roles and prevent virtual asset exchanges from independently issuing stablecoins. Regarding the second phase of virtual asset legislation, Lee confirmed that it will be submitted within the year and is currently in the final coordination stage. He also noted the potential overseas demand for stablecoins in areas such as virtual asset trading, payment settlements, and cross-border remittances, with plans to expand applications and prepare related work in advance.