The project launched earlier this year was a two-tier system involving a wholesale CBDC for interbank settlement and tokenized deposits for retail use by 100,000 citizens. However, the seven participating banks collectively spent nearly 35 billion won (about $26 million) on the initial three-month phase and were unwilling to proceed without a clear path to profitability.
A last-minute offer from BOK Governor Rhee Chang-yong to cover half the costs for the project’s second phase was rejected, signaling that the banks’ concerns were fundamental to the business case, not just the expense.
The banks see a clear commercial advantage in issuing their own stablecoins, leveraging their customer base to create new revenue streams and prevent disintermediation from fintech rivals or a state-run currency.
President Lee’s administration is fast-tracking the “Digital Asset Basic Act,” legislation that provides a legal framework for stablecoins. The act notably grants primary regulatory authority to the Financial Services Commission (FSC), not the Bank of Korea, and sets a low capital requirement of ₩500 million (about $370,000) to encourage competition.
The volume of USD-pegged stablecoin transactions in Korea reached ₩56.95 trillion ($41.6 billion) in the first quarter of 2025 alone.
The central bank has advocated for a more cautious rollout, preferring that only highly regulated banks be allowed to issue stablecoins initially before expanding to non-bank entities.
In the meantime, the BOK has framed its suspended CBDC work as a potential “countermeasure to stablecoins,” a public option to be revived if the private market proves too volatile.
