Korea Considers Liquidity Rules for Won Stablecoins Amid Sharp Price Deviations

South Korea's regulators are considering new rules for stablecoins to address liquidity issues that caused sharp price deviations on domestic exchanges. Industry participants have called for safeguards to be included in future won stablecoin rules, citing examples of foreign stablecoins experiencing abnormal price moves.

The recent trading activity has shown how limited exchange liquidity can push stablecoins far from the currencies they are designed to track. JPYC surged to 37.6 won on Upbit after its debut, while PYUSD reached an all-time high of 1,760 won before falling back toward its dollar reference value.

EURC on Bithumb also experienced a price distortion, reaching 7,860 won, exceeding its previous close by over 400%. Industry participants want regulators to examine initial circulating supply, issuance, and redemption channels, as well as market makers and controls for unusual trading.