Bank of Korea Expands CBDC Deposit Token Pilot Toward Commercial Rollout

TLDR

• Bank of Korea expands Deposit Token tests toward commercial rollout.

• Second pilot adds transfers, vouchers, and wider merchant payments.

  

• Banks seek stronger AML, fraud tools, and realistic rollout timelines.

• Digital vouchers will test subsidy payments for EV charging projects.

• Toss Bank’s Solana work shows wider tokenized payment interest.

South Korea is expanding its Deposit Token pilot as authorities prepare the system for continuous operation and eventual commercial use. The next phase will connect digital wallets with existing banking systems and add transfers, merchant payments, and settlement services. The project marks a broader shift from limited payment testing toward regulated digital banking infrastructure.

Banks Prepare Deposit Token Services for Continuous Operation

The Bank of Korea and participating lenders have discussed operating Deposit Token services without interruptions between testing stages. Their discussions aim to create the technical and regulatory conditions needed for a formal rollout. The Korea Federation of Banks submitted briefing materials outlining these plans to lawmaker Lee Heon-seung.

Commercial banks issue each Deposit Token as a digital version of money held in a bank account. However, the system operates through wholesale central bank digital currency infrastructure supplied by the Bank of Korea. This structure keeps commercial lenders responsible for customer deposits while the central bank supports settlement.

During the first pilot, selected consumers received electronic wallets from participating commercial banks. They then used Deposit Token balances to complete payments with approved merchants in real-world settings. The test mainly examined wallet functions, payment processing, and settlement across the participating institutions.

Second Pilot Adds Transfers and Banking Services

The second phase will increase the number of participating consumers and merchants across the payment network. It will also introduce person-to-person transfers and allow banks to develop their own Deposit Token services. Banks will connect these services with core account systems and existing settlement processes.

The expanded project will require stronger anti-money laundering controls and suspicious transaction reporting systems. Banks must also build fraud detection tools and improve their supporting technology before wider deployment. Therefore, participating lenders requested dedicated budgets and a longer implementation schedule from the central bank.

Banks argued that the expanded test represents a new project rather than a simple pilot extension. Person-to-person transfers and a wider merchant network create additional compliance and operational requirements. The Bank of Korea later adjusted the timeline and supported consulting work linked to commercialization plans.

Digital Vouchers Support Government Payment Testing

The project will also test business-to-business treasury payments through digital vouchers tied to public funding programs. Under the plan, authorities will distribute selected electric vehicle charging subsidies through Deposit Token payments. Companies could then receive and settle government support within the participating banking network.

The second phase will test how digital funds work inside existing bank accounts and financial systems. It will also examine whether Deposit Token infrastructure can support policy funds and controlled public spending. These functions could provide clearer transaction records and faster settlement across approved government programs.

South Korean financial institutions are also testing public blockchain systems for other payment services. Toss Bank recently signed an agreement with the Solana Foundation covering international remittances, settlements, stablecoins, and tokenized assets. However, that project remains separate because it uses public blockchain infrastructure rather than the central bank’s CBDC framework.

The Bank of Korea project forms part of South Korea’s wider review of tokenized money and digital settlement systems. Its next stage will test payments, transfers, vouchers, and commercial banking functions under one regulated structure. The results will help authorities determine the requirements for a wider Deposit Token rollout.

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