In his inaugural address, Bank of Korea Governor Shin Hyun-song highlighted the importance of central bank-issued digital currencies and bank-issued deposit tokens, noticeably excluding stablecoins from his discussion as South Korea considers new cryptocurrency regulations. Shin, who commenced his four-year term, drew attention to the bank's ongoing pilot projects, including Project Hangang for retail CBDC and deposit tokens, 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 component of the central bank's strategy amidst economic challenges and slower growth. The omission of stablecoins from his address was particularly noteworthy, given the current policy debates in Seoul surrounding the proposed 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. In his speech, he outlined a framework where the central bank would issue a CBDC, while commercial banks would provide deposit tokens that are fully convertible into the CBDC, emphasizing that any stablecoin issuance should originate from regulated banks. Furthermore, Shin indicated that the bank would enhance its monitoring of cryptocurrency markets and non-traditional financial sectors, seeking greater access to data to assess financial risks. He also committed to modernizing currency markets, including the implementation of 24-hour foreign exchange trading and an offshore won settlement system.