BOK Governor Backs CBDC and Bank Deposit Tokens, Not Stablecoins

Bank of Korea Governor Shin Hyun-song opened his four-year term on April 21, 2026, by centering the central bank’s digital strategy on a retail digital won built from a central bank digital currency and bank-issued deposit tokens. His inaugural address made no reference to privately issued won-denominated stablecoins and pointed to Project Hangang Phase 2 as the route to wider use.

Shin outlined a two-tier model: the central bank would issue a wholesale or hybrid CBDC, while commercial banks would issue fully convertible deposit tokens for everyday payments and settlements. He framed Project Hangang Phase 2 as the mechanism to move from technical testing to practical applications and to increase usability of the digital won.

Phase 2 of Project Hangang began in March 2026 and has expanded to nine major commercial banks. The program is running live transaction tests that explore programmable money, tools for regulatory compliance and integration with existing payment infrastructure. One application under study is the disbursement of government subsidies, with potential use cases valued at as much as 110 trillion won (about $73 billion).

Shin’s inaugural speech did not mention privately issued stablecoins, a notable omission as Parliament debates the Digital Asset Basic Act. In written remarks to lawmakers during his mid-April confirmation hearing, he had said CBDCs and deposit tokens would “coexist with stablecoins in a manner that is supplementary and competitive to each other,” and that any stablecoin issuance should start with regulated banks.

The Bank of Korea also referenced international work on digital currency. Shin noted BOK participation in Project Agora, a Bank for International Settlements initiative that examines multi-CBDC platforms to speed cross-border payments and settlements. He tied that participation to an objective of expanding the won’s role in global digital payments while maintaining capital controls and financial stability.

Other priorities listed in the address included expanding foreign exchange trading to 24 hours, creating an offshore won settlement system, tightening oversight of crypto markets and non-bank financial institutions, and improving data access for risk tracking. The inaugural remarks included a pledge to pursue a “cautious and flexible” monetary policy during his term.

Shin succeeds Rhee Chang-yong and takes over CBDC work at a commercialization stage. Rhee’s term focused on technical pilots; Shin’s framework emphasizes regulated, interoperable infrastructure that places commercial banks at the distribution layer while keeping the central bank at the top of the stack.

Shin brings international experience from the Bank for International Settlements, where he served from 2014 until early 2026, and academic positions including a post at Princeton University. His BIS work included collaborative CBDC experiments that involved South Korea, informing the BOK’s shift from technical testing toward applied use and broader system integration.