Shin Hyun-song, the Bank of Korea's nominee, proposed a digital money system centered around central bank digital currencies and bank-issued deposit tokens, with stablecoins playing a supplementary role. He stated that these two should coexist competitively, according to Yonhap, citing the Bank of Korea.
In his written remarks to parliament, Shin expressed support for introducing a won-based stablecoin but stressed the need for trust in the currency to come first. He views stablecoins as useful for tokenized asset trading and programmable payments, rather than as a replacement for state-backed money.
Shin's proposal is in line with the central bank's position that stablecoin issuance should start with regulated banks, due to compliance demands such as anti-money laundering and customer checks. He questioned the efficiency of blockchain-based coins in foreign exchange, citing regulatory compliance uncertainty and added costs. Shin noted that digital assets lack the core functions of money as a unit of account, medium of exchange, and store of value.
The Bank of Korea has warned of the risks privately issued tokens pose to monetary policy and financial stability, calling for strict oversight. Shin's comments come as policymakers debate market openness, with regulators pushing for bank-led models and lawmakers proposing broader frameworks for non-bank issuers under new legislation. The country's first fully regulated stablecoin, KRW1, was launched in February through a partnership between BDACS and Woori Bank.