Korean Exchanges Suffer Record Stablecoin Outflows Amid Regulatory Gridlock

South Korea's cryptocurrency exchanges have experienced net stablecoin outflows totaling $367 million in June, according to data from the Financial Supervisory Service (FSS). This marks the 18th consecutive month of capital flight, with a cumulative total of approximately $10.4 billion since January 2025.

The trend has been ongoing despite the country's struggle to finalize its Digital Asset Basic Act, which aims to create a comprehensive framework for crypto regulation. However, disputes over stablecoin regulation have stalled progress, leaving the market in limbo.

Investors are redirecting their funds to offshore derivatives trading platforms, decentralized finance protocols, and real-world asset products, where they can access global markets more easily. This shift has resulted in a 55% decline in stablecoin balances on domestic exchanges over the past 18 months.