A Samsung Global Research executive said a Korean-won stablecoin, if introduced, could be used across a range of financial services, including Samsung Wallet.

Park Hyun-soo, a managing director at Samsung Global Research, made the remarks on November 5 during a discussion at a policy seminar at the National Assembly Members' Office Building in Seoul's Yeouido district marking the publication of “The Future of Money, the Stablecoin Revolution.”

“In the U.S., users can hold dollar-based stablecoins in Samsung Wallet, and the service recently began offering transfers to 60 countries,” Park said.

He added that if a won stablecoin is issued, it would also be incorporated into Samsung Wallet in South Korea, as in the U.S. Park said the institutionalization of stablecoins could also lead to broader domestic digital payment services.

Park said financial institutions are also preparing to use stablecoins.

If tokenized securities, or STOs, begin full-scale issuance next year, using stablecoins as a means of payment on blockchain networks could be efficient, he said. He added that card companies and insurers are also internally reviewing ways to introduce stablecoins into their payment systems.

Still, Park stressed that the spread of stablecoins requires a cautious approach because of their potential effect on the existing financial system. If bank deposits shift into stablecoins, banks' credit-creation function could weaken, reducing funding for small and medium-sized businesses and lower-credit borrowers.

He also cited monetary policy effectiveness and market competition as key challenges. If stablecoins do not pay interest, the transmission of monetary policy through changes in benchmark interest rates could weaken.

Park added that network effects could concentrate the market in a small number of stablecoins or allow large Big Tech companies to dominate the sector.

He said stablecoins' low transaction costs could also change once regulation is introduced. Costs may rise once anti-money laundering, or AML, rules and know-your-customer, or KYC, requirements are fully applied.

“That does not mean stablecoins should not be introduced,” Park said. “But the framework needs to be designed with these issues fully in mind so that stablecoins can become a tool for sound financial innovation.”