South Korea and the Bank of Korea are planning to amend the Foreign Exchange Transactions Act to recognize stablecoins as payment instruments. This regulatory shift comes as the stablecoin market has contracted by nearly $8 billion from its yearly opening market capitalization of $315 billion, despite continued adoption. USDT, which accounts for more than half of the market, is down 2.5% over the past 12 months, while newer stablecoins such as RLUSD, BUIDL USD, USDf and U have attracted inflows. USDf surged by more than 42%, pushing its market capitalization above $1 billion. Bitcoin is showing resilience amid weakening liquidity, gaining more than 23% from its late-July low, but the key question is whether newer stablecoins can turn rising adoption into sustained market growth.
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