Bank of Korea Governor Supports CBDC Project

Hyun-Song Shin, the newly appointed head of the Bank of Korea, expressed support for central bank digital currencies (CBDCs) and tokenized deposits in his first public remarks.

After officially beginning his four-year term at an inauguration ceremony in Seoul on Tuesday, Shin confirmed that the central bank will move forward with the second phase of “Project Hangang,” a pilot program aimed at testing a blockchain-based wholesale CBDC system.

He also highlighted global collaboration efforts, including the Agora Project, launched in April 2024 by the Bank for International Settlements alongside seven central banks to explore tokenized cross-border payments. According to Shin, these efforts “will elevate the status of the Korean won in the digital payment environment.”

Although earlier reports suggested openness to won-backed stablecoins, Shin did not reference stablecoins during his speech.

Policy outlook and geopolitical considerations

South Korea’s stablecoin legislation remains unresolved, with regulators and lawmakers divided on whether issuance of won-pegged tokens should be restricted to commercial banks or extended to non-bank entities such as fintech and technology firms.

Shin also addressed broader macroeconomic concerns, pointing to rising tensions in the Middle East and their impact on oil prices. He emphasized the need for the central bank to respond to increasing uncertainty driven by geopolitical risks, inflation, and shifts in the global economy.

Before taking on his new role, Shin served as an economic adviser at the BIS from May 2014 to March 2026 and later led its Monetary and Economic Department starting in January 2025. In a recent academic paper, he argued that stablecoins lack a key feature of money—“unity”—due to the fragmented nature of blockchain networks, which differ in fees, security, and levels of decentralization.

South Korea explores tokenized government payments

Separately, South Korea is preparing to pilot blockchain-based payments for selected government expenditures through a regulatory sandbox focused on distributed ledger technology in public finance.

The initiative will use tokenized deposits to facilitate government operational spending, with a broader rollout targeted for the fourth quarter of 2026. The initial phase is expected to begin in Sejong City, with specific limits on timing and spending categories during the trial period.

Sources:

https://www.bis.org/about/biohss.htm#:~:text=Mr%20Shin%20was%20BIS%20Economic,Economic%20Department%20from%20January%202025

https://www.reuters.com/world/asia-pacific/bank-korea-governor-nominee-positive-about-won-denominated-stablecoins-2026-04-14/

https://cointelegraph.com/news/new-bank-of-korea-governor-backs-cbdcs-deposit-tokens-first-address

https://www.digitalasset.works/news/articleView.html?idxno=40329

https://www.coingecko.com/en/exchanges/country/south-korea