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

The South Korean Ministry of Economy and Finance is set to launch a pilot program in the fourth quarter to test the use of blockchain-based tokens for government spending, as part of a broader effort to modernize the management of public funds. According to local media reports, the pilot program has been approved under the 2026 regulatory sandbox initiative, allowing for the use of tokenized deposits to pay for business promotion expenses that were previously processed using government purchasing cards. By utilizing token-based payments, which can be programmed with predefined conditions such as spending limits and industry-specific usage, officials anticipate improved oversight and reduced need for manual audits. Additionally, the removal of intermediaries like card networks is expected to lower transaction fees for small businesses receiving government payments. This pilot program follows an earlier trial involving deposit tokens for electric vehicle-charging infrastructure subsidies and is scheduled to take place in Sejong City after a selection process for participating firms. If successful, the program may be expanded to achieve greater control over spending and measurable cost savings.