On July 18, 2025, President Donald Trump signed the GENIUS Act into law, adding a new U.S. framework to an increasingly international debate over stablecoins. The United States, European Union, and major Asian markets are taking different approaches, with implications for financial infrastructure and the role of national currencies.

The article’s 2025 outlook places the stablecoin market at approximately USD 200 billion, with dollar-denominated tokens accounting for more than 90%. As regulatory frameworks develop, the question is how far those rules will reinforce—or reshape—that market structure.

1. United States: the GENIUS Act and the dollar’s global role

Core Provisions of the GENIUS Act

The GENIUS Act creates a federal framework for payment stablecoins. Passed by the House in a 308–122 vote, it sets requirements for permitted issuers and the reserves backing their tokens.

Key provisions include at least one-to-one backing with eligible liquid reserves and approval through the applicable federal or state framework. The main effective date is the earlier of 18 months after enactment or 120 days after the relevant federal regulators issue final implementing rules.

The law also introduces restrictions on offering payment stablecoins outside the permitted framework, including conditions affecting foreign issuers. Reserve and anti-money-laundering requirements are central to the approach; the law separately calls for examination of endogenously collateralized stablecoins.

Strengthening the dollar’s international position

Treasury Secretary Scott Bessent has argued that dollar stablecoins could reinforce the currency’s international role and increase demand for U.S. Treasuries. The broader policy ambition is to extend the dollar’s existing network advantages into digital payments.

Strengths and limitations of the U.S. approach

A framework centered on U.S. requirements may create friction with other jurisdictions. Compliance costs can also make entry harder for smaller issuers and contribute to market concentration.

Its main strength is the connection to established dollar markets. Clear rules and reserve requirements can support confidence and institutional participation, while the dollar’s reach provides substantial network effects.

2. European Union: MiCA’s comprehensive framework

An integrated approach to crypto assets

The EU’s Markets in Crypto-Assets Regulation (MiCA) became fully applicable on December 30, 2024, following earlier application of its stablecoin provisions. It addresses a broader range of crypto assets and service providers than a stablecoin-only framework.

MiCA distinguishes between asset-referenced tokens, e-money tokens, and other crypto assets, with different requirements for each. Authorization and reserve rules depend on the category, shaping how both euro- and foreign-currency-linked tokens can operate in the EU.

The crypto-asset service provider (CASP) authorization framework supports access across the EU’s 27 member states, giving authorized providers a route to operate within the single market.

Implementation challenges

Early implementation has exposed practical difficulties, including the cost of authorization and compliance. Restrictions affecting noncompliant stablecoins have also changed the products available through European service providers.

Practitioners have highlighted the challenge for startups of finding compliance expertise and meeting demanding requirements while continuing product development.

The priorities behind the European model

MiCA emphasizes consumer protection and market integrity, alongside disclosures concerning environmental impacts. Its rules also address market manipulation and insider dealing.

The challenge is to make that protection compatible with workable innovation. A comprehensive framework can provide clarity, but its complexity and cost can also slow smaller businesses.

3. Asia: different routes to regulated innovation

Japan: integration with established financial institutions

Japan’s June 2022 amendment to the Payment Services Act established a framework for certain stablecoins as electronic payment instruments, connecting their treatment to the existing financial system.

The regulatory treatment depends on how a token maintains its value and the rights it gives its holder. Fiat-linked electronic payment instruments are distinguished from crypto-asset-based mechanisms that fall under other rules.

Banks, funds transfer service providers, and trust companies have different roles and requirements under this framework, reflecting the legal structure of the instrument they issue.

Intermediaries also face registration requirements. Foreign-issued instruments can be handled only where the relevant conditions are satisfied.

SBI VC Trade’s introduction of USDC services and interest in yen-linked issuance illustrate the framework’s practical significance. Clear rules can reduce uncertainty even while adoption develops gradually.

Singapore: a focused stablecoin framework

In August 2023, the Monetary Authority of Singapore (MAS) finalized a framework for single-currency stablecoins, focusing on tokens designed to maintain a stable value against a specified currency.

The framework covers qualifying stablecoins pegged to the Singapore dollar or a G10 currency. It includes requirements for reserve quality, full backing, redemption, and related safeguards.

MAS has emphasized the potential of well-regulated stablecoins as a payment medium. This sits alongside its separate assessment of the need for retail CBDCs.

Singapore also applies requirements to certain digital token businesses serving overseas markets, seeking consistent oversight and reducing opportunities for regulatory arbitrage.

South Korea: a proposed framework and the won stablecoin debate

In June 2025, Representative Min Byung-deok proposed a Digital Asset Basic Act covering the digital asset lifecycle across 171 articles and ten chapters.

The proposal includes a route for won-denominated stablecoin issuance with Financial Services Commission approval and a minimum capital requirement of KRW 500 million. It also proposes reserve and insolvency-protection measures. These are provisions of the proposal discussed in this article, rather than a statement that the bill had already become law.

A proposed presidential digital asset committee would coordinate industry policy and oversight across relevant authorities.

The bill differentiates between authorization, registration, and reporting requirements according to the activity. It also proposes an industry self-regulatory body and measures addressing unfair trading and investor protection.

The proposal frames digital asset legislation as part of Korea’s wider digital economy strategy, including the role of won stablecoins in monetary sovereignty.

4. Comparing the approaches

Different policy priorities

The U.S. approach connects stablecoin regulation with the dollar’s international reach. It seeks to strengthen confidence through issuer and reserve requirements while influencing global market standards.

The EU emphasizes a comprehensive market framework, consumer protection, and financial autonomy, with rules that apply across the single market.

Asian jurisdictions take distinct approaches: Japan works through established financial institutions, Singapore focuses on its financial-hub role, and Korea’s debate includes monetary sovereignty and digital economy development.

Entry requirements and market access

U.S. approval and reserve requirements can create substantial entry costs, particularly for smaller issuers. Providers that meet them gain access to a large financial market.

MiCA offers access to the EU single market, but compliance complexity and differences in implementation can make entry demanding.

Japan’s framework emphasizes established institutional categories, while Singapore combines openness with defined safeguards. Korea’s proposal uses a comparatively low capital threshold to encourage participation, alongside approval and reserve requirements.

Balancing innovation and stability

The U.S. framework places strong emphasis on eligible reserves and supervised issuers. The challenge is to protect stability without unnecessarily restricting useful experimentation.

The EU seeks a sustainable market through broad safeguards, while facing the practical burden those rules place on new entrants.

Japan and Singapore illustrate different ways to pursue controlled innovation: one through established institutional structures, the other through targeted regulatory frameworks.

Korea’s proposal combines an intention to encourage participation with significant supervisory concerns. Turning that balance into workable services will depend on the detail of legislation and implementation.

5. Global effects and interaction

Regulatory arbitrage

Different rules can influence where companies establish entities and offer services. Changes in the availability of stablecoins in Europe illustrate how regulation can alter competitive positions.

Businesses may seek jurisdictions with more workable requirements, potentially reducing the effectiveness of any one country’s rules. International coordination matters for that reason.

A clear, innovation-friendly Korean framework could attract activity, but it would also need safeguards against being used to avoid legitimate oversight elsewhere.

Pressure for international alignment

As regional frameworks mature, the need for common standards increases. Each jurisdiction has an interest in making its own model influential internationally.

Bodies such as the FATF, G20, and Financial Stability Board contribute to international coordination. Reaching agreement remains difficult where national priorities diverge.

Effects on technology development

Regulatory requirements influence the technology providers build, from reserve monitoring and collateral management to environmental reporting and operational controls.

Different currency frameworks in Japan, Singapore, and Korea also create room to test distinct stablecoin models and applications.

Interoperability is particularly important: assets issued under different frameworks need reliable ways to exchange data and value.

6. Possible paths ahead

Scenario 1: continued dollar dominance

In one scenario, compliant dollar stablecoins extend their global reach, while other currency-linked tokens serve more regional or specialized uses.

That could reinforce U.S. financial influence while raising concerns about capital flows and monetary sovereignty in other countries.

Scenario 2: regional ecosystems

A second scenario is a more regional market, with dollar, euro, and Asian currency ecosystems developing alongside one another. Cross-border coordination could become more complex, but national currencies could retain a stronger role.

A successful won stablecoin could support regional use cases linked to Korean trade, technology, and cultural services, though demand would depend on practical utility.

Scenario 3: greater international standardization

A third scenario involves common standards coordinated through international institutions. Ideas such as SDR-linked instruments or jointly developed central bank systems would require extensive agreement on governance and implementation.

7. What would make each model work?

United States

The U.S. can draw on the dollar’s reach, deep capital markets, and established supervisory institutions. Those advantages can reinforce one another through network effects.

Success will also depend on managing compliance burdens and international friction, including the development of other national-currency stablecoins.

European Union

The EU’s challenge is to turn comprehensive rules into a consistent, workable framework across 27 member states, with clearer implementation and manageable compliance processes.

Its emphasis on consumer protection and sustainability could also influence how other markets develop their own approaches.

Asia

Asian markets can differentiate through their own strengths: institutional stability in Japan, financial connectivity in Singapore, and technology and service development in Korea.

Regional cooperation, including through existing economic frameworks, could help connect these strengths into a broader ecosystem.

8. Korea’s strategic choices

An evolving competitive landscape

As of 2025, these frameworks were still developing. MiCA was in force, the GENIUS Act had been signed, and Asian jurisdictions were pursuing their own approaches. No single model had established global dominance.

Two factors stand out: regulatory clarity and compatibility with existing financial infrastructure. Businesses need rules they can plan around and systems that connect with how finance already operates.

Opportunities for Korea

Korea has a smaller market than the U.S. or EU but can draw on strong technology capabilities and implementation experience. A coherent legal framework would help turn those strengths into practical services.

Won stablecoins could support use cases linked to Korean commerce and cultural exports, particularly where there is a clear need for more efficient payment and settlement.

Capabilities in AI, communications, and blockchain could also help Korean providers build differentiated infrastructure.

Priorities for progress

Clear legislation and international cooperation are important foundations. Korea can also participate in regional connectivity projects and global standards discussions.

Continued technical development must be matched by credible risk management, balancing useful innovation with consumer protection and financial stability.

Outlook

Dollar stablecoins are likely to retain substantial influence in the near term, while regional ecosystems may develop over time. Korea’s position will depend on how effectively it connects policy, technology, and practical demand.

The legislative debate described in this article is an important opportunity to establish those foundations. The outcome will shape how Korean businesses participate in digital finance.

SOOHO.IO’s role in digital financial infrastructure

SOOHO.IO contributes security technology and implementation experience to organizations developing digital asset services.

Its C2CC cross-chain technology, Reagent smart contract security solution, and experience protecting KRW 3.2 trillion in assets provide a technical foundation for work on won stablecoins and related infrastructure.

Collaboration among financial institutions, technology providers, and policymakers will be essential to translating the regulatory discussion into dependable services.

Contact our team for more information or to discuss a partnership.

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