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The South Korea stock market has been supervised by an investor frenzy on digital money based in Won this month, following the commitment of the newly elected president Lee Jae-Myung to authorize the cryptographic assets supported by the national currency.
The actions that have been involved in the Korean Bank’s digital currency project, notably Kakao Pay and LG CNS, were on a crazy race. Kakao Pay’s shares have more than doubled this month and the LG CNS increased by almost 70%, before offering earnings this week on the realization.
On the Kosdaq junior market, the action of the Société de Sécurité Fintech Aton jumped 80%, while Me2on, a mobile game producer, tripled, his subsidiary recently launched a stablecoin to casino games.
The wave of retail enthusiasm for the probable show of Stablescoins Won, as well as the expectations of policies adapted to the shareholders of the new government, have helped stimulate the Kospitic composite reference index this year at a summit of almost four years. He also made South Korea the most efficient market in Asia in the first half.
The market rally has encouraged retail investors to increase their lever effect to continue gains, with exceptional margin loans passing to Won20.5TN ($ 15 billion), according to data from the Korea Financial Investment Association.
The popularity of the actions considered potentially benefiting from stable won intervenes despite the fact that the government has not yet announced the details of its cryptocurrency policies.
The expectations had been fueled by the appointment by Lee of Kim Yong-Beom, a long-standing defender of digital tokens, as a chief political advisor, and by a parliamentary bill proposed by the ruling party this month to promote the country’s digital asset industry.
The bill will allow companies with as little as Won500MN in actions capital to issue stablescoins Won-a move warning that criticisms could open valves to sub-capitalized players and cause systemic risks.
South Korea is one of the most dynamic cryptographic markets in the world, with around a fifth of the country’s population exchange population. The stable trade fished by an American dollar in the country hit Won57TN in the first three months of this year, stacking pressure on the Korean bank to speed up preparations to issue its own digital currencies.
Banks, brokerage houses and fintech companies show a strong interest in entering the company, although the government does not decide the issuers and the calendar.
“We want to do the business, but we monitor where the government is drawing the line in terms of regulation,” said an fintech industry manager.
The Governor of the Korean Bank, Rhee Chang-Yong, expressed his concern about any issue of staboins won by non-banking entities, citing their impact on capital flows and the efficiency of monetary policy. The Central Bank said it would consult large commercial banks on the preparation of a second pilot test for its digital currency.
However, experts have warned that certain actions focused on increasing the growing interest in digital tokens could be overvalued according to their fundamental principles. They urged investors to be cautious due to the volatility of stocks.
“The stablecoins won are likely to be presented, but how much it will help to increase business income is questionable,” said Hwang Sei-Woon, principal researcher at Korea Capital Market Institute.
“Investors’ expectations seem to be exaggerated, given the regulatory uncertainties still high. And some of the high-flying companies still do not have the technologies and infrastructures necessary for the Stablecoins,” he added.
