The Bank of Korea's nominee, Shin Hyun-song, has 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 supporting role. According to Yonhap, Shin stated that he expects central bank digital currencies and deposit tokens to coexist with stablecoins in a supplementary and competitive manner.
In his written remarks to parliament, Shin expressed support for introducing a won-based stablecoin, but stressed that establishing trust in the currency is paramount. He views stablecoins as useful for trading tokenized assets and facilitating programmable payments, rather than as a replacement for state-backed currency.
Shin's proposal is in line with the central bank's existing stance that stablecoin issuance should be initiated by regulated banks, citing compliance requirements such as anti-money laundering and customer verification as key reasons. He also raised concerns about the efficiency of blockchain-based coins in foreign exchange, citing regulatory uncertainties and added costs. Furthermore, 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, and has called for strict oversight, including anti-money laundering and customer verification rules. Shin's comments 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. Recently, the country's first fully regulated stablecoin, KRW1, was launched through a partnership between crypto custody service provider BDACS and Woori Bank.