In his inaugural address, Bank of Korea Governor Shin Hyun-song highlighted the importance of central bank digital currencies and bank-issued deposit tokens, but notably excluded stablecoins from his discussion, as South Korea considers new cryptocurrency regulations. Shin, who commenced his four-year term, referenced the bank's ongoing retail CBDC 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 the central bank's evolving role in a period of economic challenges and slower domestic growth.
The omission of stablecoins from his remarks was significant, given the current policy debate in Seoul, where lawmakers are reviewing the Digital Asset Basic Act, which would 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 bank-led model, where the central bank would issue a CBDC, and commercial banks would provide deposit tokens that are fully convertible into it. Shin has argued that any stablecoin issuance should originate from regulated banks. In addition to payments, Shin indicated that the central bank would increase its scrutiny of crypto markets and non-bank finance, expanding its monitoring of cryptocurrencies and other non-traditional assets, and seeking broader 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 won settlement system.