Bank of Korea study finds dollar stablecoin demand can push local currencies lower
A Bank of Korea study found that when Binance introduced direct fiat-to-stablecoin pairs, local currency premiums fell and demand transmitted into foreign exchange markets.
Why it matters
The research establishes a concrete transmission mechanism through which crypto market activity can affect traditional foreign exchange markets, which may inform regulatory approaches to stablecoin oversight and cross-border capital flow monitoring.
Where the sources disagree
Korean exchange-rate impact
Korea showed no measurable exchange-rate response
Crypto.News
Brazilian real depreciated 0.118% linked to Bitcoin search rise
CoinDesk
Crypto.News reported Korea showed no measurable exchange-rate response, while CoinDesk's account focused on Brazilian real depreciation without addressing Korea
Key facts
The study was written by researchers Jihyun Kim and Sangheum Cho
Reported by CoinDesk
Korea showed higher stablecoin premiums but no measurable exchange-rate response without direct Binance pairing access
Reported by Crypto.News
The findings do not establish that stablecoin demand always causes currency depreciation
Reported by Crypto.News
Market makers sell received local currencies for dollars while balancing stablecoin trading positions
Reported by CoinDesk
What happened
A study by Bank of Korea researchers Jihyun Kim and Sangheum Cho found that demand for dollar-backed stablecoins can exert downward pressure on national currencies when investors gain direct access through fiat trading pairs. The research examined 12 currencies across pairing events from 2019 to 2025, focusing on what occurred when Binance introduced direct trading between local currencies and stablecoins such as USDT and USDC. The researchers found local stablecoin premiums declined between 0.33 and 0.38 percentage points following these introductions, as market makers sold received local currencies for dollars while balancing their positions. While Crypto.News noted that Korea itself showed higher stablecoin premiums but no measurable exchange-rate response due to lacking direct Binance pairing access, CoinDesk reported that a standard-deviation rise in Bitcoin searches was linked to a 0.118% depreciation of the Brazilian real. Crypto.News also clarified that the findings do not establish that stablecoin demand always causes currency depreciation, suggesting the measured effects may be limited to specific conditions.
How the story developed
- Official statement
Bank of Korea publishes research on stablecoin-FX transmission
Study by Jihyun Kim and Sangheum Cho released examining 12 currencies from 2019 to 2025
- First report
First report by CoinDesk
Dollar-backed stablecoins can push local currencies lower, Bank of Korea study finds
- Update
CoinDesk reports on Bank of Korea stablecoin study
Coverage highlighting Binance fiat pairings and correlation with local currency depreciation
- Independent corroboration
Independently corroborated by Crypto.News
Dollar stablecoins can weaken local currencies, BOK finds
- Update
Crypto.News provides independent coverage with additional context
Report notes Korea-specific findings and clarifies findings do not establish causation
How coverage built up
Independent sources over time, counted the way the consensus panel counts them: a republication of a wire story does not move the line.
- 5 Sept 2026, 16:43 UTC: CoinDesk — 1 independent source, 1 reports
- 6 Sept 2026, 09:33 UTC: Crypto.News — 2 independent sources, 2 reports
Affected entities
Also mentioned: Chainalysis, Brazil
Original sources
| Publisher | Report | Role | Published |
|---|---|---|---|
| CoinDesk Crypto media | Dollar-backed stablecoins can push local currencies lower, Bank of Korea study finds | Original | |
| Crypto.News Crypto media | Dollar stablecoins can weaken local currencies, BOK finds | Independent |
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