In his maiden speech, Bank of Korea Governor Shin Hyun-song emphasized the importance of central bank digital currencies and bank-issued deposit tokens, while notably omitting stablecoins from his discussion. This comes as South Korea is in the process of formulating new regulations for the crypto sector. Governor Shin referenced the bank's ongoing pilot projects, including Project Hangang, which focuses on retail CBDCs and deposit tokens, as well as its participation in Project Agorá, a global tokenization initiative.
He positioned digital currencies as a key component of the central bank's strategy to navigate economic challenges and sluggish growth. The absence of stablecoins from his address is significant, given the current policy debates in Seoul surrounding the Digital Asset Basic Act, which aims to establish guidelines 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 framework where the central bank would issue CBDCs, and commercial banks would provide deposit tokens that are fully convertible into them. Furthermore, Shin indicated that the bank would strengthen its monitoring of crypto markets and non-traditional financial institutions, seeking greater access to data to assess financial risks. He also committed to modernizing currency markets by introducing 24-hour foreign exchange trading and an offshore settlement system for the Korean won.