South Korea's central bank puts CBDC project on hold, banks expected to focus more on stablecoins

PANews reported on June 30 that according to Maeil Business Newpaper, the central bank-led digital currency (CBDC) project being promoted by the Bank of Korea (central bank) was temporarily shelved before the second test due to an increase in complaints from banks participating in the pilot project and heated discussions in Congress and the private sector on the introduction of the Korean won stablecoin. Recently, in the context of the uncertainty of whether the central bank-led digital currency and the private stablecoin can coexist, private discussions on the legislation of the Korean won stablecoin have been initiated, and the Bank of Korea has decided to postpone further testing to minimize uncertainty.

Therefore, it is expected that banks will focus more on introducing stablecoins in the Korean won. Currently, nine banks including Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank, NH Nonghyup, IBK Bank, iM Bank, Suhyup Bank, and K-Bank are participating in the Open Blockchain and DIDIA (OBDIA), which is leading the discussion on the issuance of stablecoins in the banking industry. Busan Bank, Gyeongnam Bank, and Toss Bank are also considering joining.