In his inaugural address, Bank of Korea Governor Shin Hyun-song emphasized the importance of central bank-issued digital currencies and bank-backed deposit tokens, notably excluding stablecoins from his remarks as South Korea considers new cryptocurrency regulations. Shin, who commenced his four-year term, highlighted the bank's ongoing retail central bank digital currency and deposit token pilot project, as well as its participation in the cross-border tokenization initiative, Project Agorá, led by the Bank for International Settlements.
He positioned digital currency as a key aspect of central banking evolution amidst economic challenges and slower domestic growth. The omission of stablecoins from his speech was striking, given the current policy debate in Seoul surrounding the Digital Asset Basic Act, which aims to establish rules 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-centric model, where the central bank would issue a digital currency, while commercial banks would provide fully convertible deposit tokens. Furthermore, Shin announced plans to increase scrutiny of cryptocurrency markets and non-bank financial institutions, expanding the central bank's monitoring of non-traditional assets and seeking greater access to data to track financial risks. He also pledged to modernize currency markets, including the introduction of 24-hour foreign exchange trading and an offshore settlement system for the Korean won.