In his inaugural address, Bank of Korea Governor Shin Hyun-song highlighted the importance of central bank digital currencies and bank-issued deposit tokens, omitting any reference to stablecoins as South Korea considers new cryptocurrency regulations. Shin, who began his term on Tuesday, mentioned the bank's ongoing retail CBDC pilot, Project Hangang, and its participation in Project Agorá, a cross-border tokenization initiative led by the Bank for International Settlements.
He positioned digital currency as part of a broader central banking shift amid economic challenges and slower domestic growth. Notably, Shin's remarks did not include stablecoins, a topic that has been at the forefront of policy discussions in Seoul, with lawmakers debating the Digital Asset Basic Act, which would establish rules for stablecoin issuance. Previously, Shin had suggested that stablecoins could coexist with CBDCs and deposit tokens in a complementary and competitive manner.
His speech outlined a bank-led model, where the central bank would issue a CBDC and commercial banks would provide deposit tokens that can be fully converted into it. Shin has argued that stablecoin issuance should originate from regulated banks.
Additionally, Shin indicated that the central bank would increase scrutiny of crypto markets and non-bank finance, expanding its monitoring of cryptocurrencies and other non-traditional assets, and seeking greater access to data to track financial risks. He also pledged to modernize currency markets, including implementing 24-hour foreign exchange trading and an offshore won settlement system.