Shin Hyun-song, the nominee to head the Bank of Korea, proposed that the country's digital monetary system should be centered around a central bank digital currency and bank-issued deposit tokens, with stablecoins playing a secondary role. He stated that he expects these two to coexist with stablecoins in a supplementary and competitive manner.
In his written remarks submitted to parliament, Shin expressed support for introducing a won-based stablecoin but stressed that trust in the currency must be established first. He views stablecoins as useful for trading tokenized assets and facilitating programmable payments, rather than replacing state-backed money. Shin's proposal aligns with the central bank's stance that stablecoin issuance should be initiated by regulated banks, citing compliance demands such as anti-money laundering and customer checks. He also questioned the claim that blockchain-based coins would enhance foreign exchange efficiency, citing uncertainty around regulatory compliance and added costs.
Shin noted that digital assets fall short of fulfilling the core functions of money as a unit of account, medium of exchange, and store of value. The Bank of Korea has warned that privately issued tokens could pose risks to monetary policy and financial stability, advocating for strict oversight including anti-money laundering and customer verification rules. Shin's remarks come amid policymakers' debate on how to regulate the market, with regulators pushing for bank-led models and lawmakers proposing broader frameworks that would allow non-bank issuers under new legislation.