South Korea to Introduce Blockchain-Based Deposit Tokens for Public Expenditure in Q4

In a bid to modernize public fund management, South Korea's Ministry of Economy and Finance is set to launch a trial of blockchain-based deposit tokens for government spending in the fourth quarter. This initiative is part of a broader regulatory sandbox program approved for 2026, as reported by local media. The pilot aims to utilize digital currency for Treasury fund expenditures, starting with business promotion expenses that are currently processed using government-issued purchasing cards. By tokenizing deposits, the ministry seeks to enhance oversight and introduce more efficiency into the system. Token-based payments can be pre-programmed with specific conditions, such as usage limits and eligible industries, potentially reducing the necessity for manual audits and lowering transaction fees for small businesses receiving government payments. This development follows an earlier successful pilot involving deposit tokens for subsidies related to electric vehicle charging infrastructure. The upcoming trial is scheduled to take place in Sejong City, with plans for expansion if it demonstrates improved spending control and significant cost savings.