In his inaugural address, the newly appointed Governor of the Bank of Korea, Shin Hyun-song, highlighted the importance of central bank digital currencies and bank-issued deposit tokens, omitting any reference to stablecoins amidst South Korea's ongoing discussions on new cryptocurrency regulations. Governor Shin, who began his term on Tuesday, drew attention to the bank's ongoing pilot projects, including the retail central bank digital currency and deposit-token initiative, Project Hangang, as well as its participation in Project Agorá, a cross-border tokenization effort led by the Bank for International Settlements. He positioned digital currency as a key component of a broader transformation in central banking, particularly during times of economic challenge and slower domestic growth.
Notably, Shin's remarks did not mention stablecoins, a topic that has been at the forefront of policy debates in Seoul, with lawmakers currently considering the Digital Asset Basic Act, which aims to establish guidelines for stablecoin issuance. Previously, Shin had suggested that stablecoins could coexist with central bank digital currencies and deposit tokens in a complementary and competitive manner. His speech outlined a bank-led model, where the central bank would issue a central bank digital currency, while commercial banks would provide deposit tokens that are fully convertible into it. Furthermore, Shin emphasized the need for increased scrutiny of crypto markets and non-bank financial institutions, announcing plans to expand the central bank's monitoring of cryptocurrencies and other non-traditional assets, as well as seeking broader access to data to track financial risks.
Additionally, he pledged to take steps to modernize currency markets, including the introduction of 24-hour foreign exchange trading and an offshore won settlement system.