The nominee to lead the Bank of Korea, Shin Hyun-song, has expressed support for a digital money system centered around a central bank digital currency and bank-issued deposit tokens, with stablecoins playing a secondary role. In his written remarks, Shin stated that he expects central bank digital currencies and deposit tokens to coexist with stablecoins in a supplementary and competitive manner.
He emphasized the importance of trust in the currency and proposed introducing a won-based stablecoin, while stressing that stablecoins should be used for specific purposes such as trading tokenized assets and enabling programmable payments, rather than replacing state-backed money. Shin's proposal aligns with the central bank's position that stablecoin issuance should be led by regulated banks, citing compliance demands such as anti-money laundering and customer checks. He also expressed skepticism about the potential benefits of blockchain-based coins in improving foreign exchange efficiency, citing regulatory compliance and added costs as concerns.
Furthermore, Shin noted that digital assets fall short of fulfilling the core roles of money as a unit of account, medium of exchange, and store of value. The Bank of Korea has previously warned about the risks posed by privately issued tokens to monetary policy and financial stability, and has called for strict oversight, including anti-money laundering and customer verification rules. Shin's remarks come as policymakers debate the extent to which the market should be opened up, with regulators pushing for bank-led models and lawmakers proposing broader frameworks that would allow non-bank issuers under new legislation.