Bank of Korea Rules Out Direct Stablecoin Operations

The Bank of Korea has clarified its position on digital assets, ruling out direct central bank operation of stablecoin businesses. According to CryptoNews, Governor Hyun Song Shin told lawmakers during an October 12 parliamentary testimony that private companies are the appropriate entities to handle stablecoin issuance and operations, while the central bank concentrates on developing its institutional digital currency system.

Division of Responsibilities

Governor Shin distinguished privately operated stablecoins from the central bank's Project Hangang during the audit at the Bank of Korea headquarters in Seoul. He explained that stablecoins are designed to circulate through decentralized blockchain networks independently of central bank currency, making private-sector management suitable. Meanwhile, the central bank maintains responsibility for interbank settlement and monetary stability.

Project Hangang combines institutional digital currency with deposit tokens issued and managed by commercial banks, preserving South Korea's existing two-tier monetary system. Shin also noted that the institution has not considered a general-purpose retail central bank digital currency since 2023.

Key facts

• Bank of Korea Governor Hyun Song Shin stated on October 12 that private companies should handle stablecoin operations.
• Project Hangang combines institutional digital currency with commercial bank-issued deposit tokens for interbank settlement.
• The central bank has not considered a general-purpose retail central bank digital currency since 2023.
• Private financial institutions continue testing blockchain-based payment services, including stablecoin settlement for tokenized securities.