The nominee to lead the Bank of Korea, Shin Hyun-song, has expressed his support for a central bank digital currency, suggesting that it should form the foundation of South Korea's digital monetary system, with stablecoins playing a secondary role. He noted that central bank digital currencies and deposit tokens can coexist with stablecoins in a complementary and competitive manner.
Shin emphasized the need for trust in the currency to come first, highlighting the importance of introducing a won-based stablecoin with strict anti-money laundering and compliance controls. He views stablecoins as useful for trading tokenized assets and enabling programmable payments, rather than replacing state-backed money. Shin's proposal is in line with the central bank's position that stablecoin issuance should begin with regulated banks, citing compliance demands such as anti-money laundering and customer checks.
He also expressed skepticism about the potential of blockchain-based coins to improve foreign exchange efficiency, due to regulatory compliance uncertainty and added costs. Furthermore, Shin stated that digital assets fall short of fulfilling the core roles of money as a unit of account, medium of exchange, and store of value. His remarks come as policymakers debate the extent to which the market should be opened, with regulators pushing for bank-led models and lawmakers proposing broader frameworks that would allow non-bank issuers under new legislation.