South Korea saw 560.3 billion won ($367 million) in stablecoin outflows to overseas exchanges in June, extending the country’s streak of monthly net stablecoin outflows to 18 consecutive months.
The figure comes from Financial Supervisory Service (FSS) data obtained by Yonhap News Agency through People Power Party lawmaker Lee Jong-wook. South Korea’s five major crypto exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — transferred 2.7 trillion won ($1.81 billion) in stablecoins offshore in June and received 2.2 trillion won ($1.44 billion) from foreign platforms.
Market participants cited by Yonhap attributed the transfers to demand for products restricted or unavailable on domestic exchanges, such as overseas derivatives, tokenized real-world assets (RWAs), decentralized finance and staking products.
Lee has called on the government to reassess how it protects investors and supervises cross-border crypto activity as stablecoin outflows continue. “The government must comprehensively examine its investor protection and supervisory frameworks again and move swiftly to improve regulations,” he said, according to The Korea Times.
South Korea weighs tighter rules for offshore activity
The outflows come as South Korea works to complete a broader legal framework for digital assets. On Thursday, a policy report recommended that authorities introduce an interim licensing guidance and phase in stablecoin regulations before the Digital Asset Basic Act is finalized.
The proposed act would create the country’s first comprehensive digital asset framework, including rules for stablecoin issuance, disclosures and market activity. However, lawmakers have yet to reconcile multiple proposals, with disagreements over which institutions should be allowed to issue won-pegged stablecoins contributing to delays.
Related: South Korea plans stablecoin rules as opposition pushes crypto tax repeal
South Korean regulators have also sought to expand reporting requirements for crypto transfers. On June 22, South Korea’s Financial Intelligence Unit (FIU) proposed extending Travel Rule reporting requirements to transactions below 1 million won (about $650).
The FIU also called for stronger action against unregistered overseas exchanges serving South Koreans. The agency said uneven licensing and supervision across jurisdictions created opportunities for regulatory arbitrage, a concern underscored by the country’s continued stablecoin outflows.
Magazine: The real reason DeFi projects that survived 2022 crash are shutting down now
