According to PANews, the South Korean Bank Union has issued a strong warning regarding the introduction of the Korean won stablecoin and other current issues. On July 28, Kang Young-dae, the chairman of the union, stated that stablecoins are emerging as a 'new form of disguised deposit business.' He criticized these virtual currencies for presenting themselves as safe assets while attracting public funds without offering interest.
Kang highlighted the inherent risks associated with stablecoins, which are subject to IT, market, credit, and operational risks. He emphasized that the value of funds exchanged for virtual currencies cannot be guaranteed through reserves. A loss of trust in the token issuer could lead to a 'run,' causing the issuer to sell off government bonds and resulting in consumer losses. Such a scenario could potentially impact the South Korean economy.