South Korea’s Stock Market Thrives as Cryptocurrency Backing Shows Promise
South Korean equities are booming following President Lee Jae-myung’s promise to allow cryptocurrency assets tied to the won. Retail investors are now eager to invest in firms linked with digital money projects.
The Kospi Composite index has seen a nearly 30% increase this year, topping Asia’s stock performance in the first half.Stocks tied to the Bank of Korea’s digital currency projects have seen big price shifts.
As an example, LG CNS shares climbed by 70% in June before a slight drop. Though, Kakao Pay stocks more than doubled. The excitement has extended to the Kosdaq market, where stablecoin-related companies have seen notable growth.
Fintech security firm Aton saw a 80% jump, while game producer ME2ON tripled after its subsidiary introduced a dollar-pegged stablecoin for casino uses.
The retail enthusiasm has boosted margin loans to Won20.5 trillion ($15 billion). Lee’s selection of Kim Yong-beom, a digital token supporter, as a policy advisor has intensified these expectations.
A parliamentary bill proposed this month would enable companies with Won500 million in equity capital to issue won-based stablecoins. The Bank of Korea is speeding up its digital currency preparations as USD-pegged stablecoins hit ₩57 trillion in the first quarter.
Banks, financial firms, and fintech companies are keen on stablecoin issuance. Yet,government regulation remains uncertain. “We’re interested but cautious about the regulatory boundaries,” said a fintech executive.
