In his inaugural address, Bank of Korea Governor Shin Hyun-song highlighted the importance of central bank digital currencies and bank-issued tokens, while notably omitting stablecoins from his discussion. This comes as South Korea is in the process of formulating new cryptocurrency regulations.
Governor Shin referenced the bank's ongoing Project Hangang, a retail CBDC and deposit token pilot, as well as its participation in Project Agorá, a global tokenization initiative led by the Bank for International Settlements. He positioned digital currencies as a key aspect of the central bank's strategy during a period of economic challenge and slower growth.
The absence of stablecoins from his remarks is significant, given the current policy debates in Seoul surrounding the Digital Asset Basic Act, which aims to establish guidelines for stablecoin issuance. Previously, Governor Shin had suggested that stablecoins could coexist with CBDCs and deposit tokens in a complementary and competitive manner.
His speech outlined a model where the central bank would issue a CBDC, and commercial banks would provide fully convertible deposit tokens. Additionally, he emphasized the need for closer monitoring of crypto markets and non-bank financial activities, and pledged to expand the central bank's access to data to better track financial risks.
Governor Shin also committed to modernizing currency markets, including the introduction of 24-hour foreign exchange trading and an offshore won settlement system.