South Korea’s Financial Services Commission has launched a fact-finding investigation into services that let users buy Korean mobile gift cards with offshore-issued won- and yen-pegged stablecoins. The Korea Financial Intelligence Unit and Financial Supervisory Service are examining KRWQ Gifts, launched by blockchain company IQ, as well as JPYC-related channels involving Web3 service Unify and the Kaia-linked DragonSwap decentralized exchange. Authorities are concerned that gift cards that can be readily converted into cash may provide a laundering route when virtual assets are acquired without know-your-customer checks. KRWQ, jointly developed by IQ and Frax and first issued in October last year, is pegged 1:1 to the South Korean won and can be used to buy cards from about 90 brands, including Olive Young, Daiso and Paris Baguette. The FSC said offshore operators targeting South Korean users can fall under the Specified Financial Information Act and that it may seek documents, issue corrective orders and notify relevant agencies, with strict enforcement if violations are confirmed. The regulator is also reviewing stablecoin issuance and offshore distribution rules and acknowledged that enforcement against offshore operators remains an international challenge.