“Cash disappears,” the Korean-language post adds. “The government can change the rules governing money at will.”<\/p>\n
![\"<span>Screenshot](\"https:\/\/www.europesays.com\/korea\/wp-content\/uploads\/2026\/08\/https:\/\/media.zenfs.com\/en\/afp_factcheck_my_711\/d813bc4751b11c22b163e4881bc939f7.jpg\"\/)
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Screenshot of misleading post taken August 19, 2026, with orange X added by AFP<\/p>\n
Another post shared on Threads<\/a> includes illustrations depicting someone attempting to use digital currency, only to see the payment rejected because their “social credit” score is too low.<\/p>\n Online discussions around CBDCs — which are being explored by many central banks<\/a> worldwide — have repeatedly sparked<\/a> misinformation debunked<\/a> by AFP ( archived link<\/a>).<\/p>\n Scores of baseless posts<\/a> often portray them as a means to enact a “social credit” system — where governments supposedly capture data on undesirable behaviour and use the information to reward or punish individuals.<\/p>\n Similar claims<\/a> rocketed on social media<\/a> following\u00a0 reports<\/a> that South Korea’s central bank — the Bank of Korea (BOK) — was preparing to launch the second phase of its CBDC pilot project ( archived link<\/a>).<\/p>\n The circulating posts are misleading, several digital finance and security experts told AFP.<\/p>\n Baseless ‘social credit’ claims<\/p>\n Kim Chae-hyun<\/a>, an assistant professor of digital finance at Pukyong National University, told AFP on August 14 that “for a so-called ‘social credit system’ to operate, simply digitising a means of payment would not be enough” ( archived link<\/a>).<\/p>\n The infrastructure being tested by the BOK “does not contain such control mechanisms”, he added.<\/p>\n Lee Yong-jun<\/a>, a professor of computer science at Far East University’s department of hacking and security, separately said on August 18 that equating the project to a social credit system “overlooks significant institutional and technological limitations”\u00a0( archived link<\/a>).<\/p>\n A “separate infrastructure” would be required to construct the latter.<\/p>\n Named\u00a0 Project Hangang<\/a> after Seoul’s Han River, the digital currency trial\u00a0tests a\u00a0 wholesale CBDC<\/a> (archived\u00a0 here<\/a> and here<\/a>).<\/p>\n Under the system, the central bank issues digital currency only to commercial banks, which then distribute tokenised deposits<\/a> for people to use at designated locations ( archived link<\/a>).<\/p>\n Transactions are made using the tokenised deposits — the equivalent of existing bank deposits recorded on a programmable platform such as a blockchain — not the CBDC issued by the central bank.<\/p>\n The second phase of the pilot expands<\/a>\u00a0the number of participating banks and services ( archived link<\/a>).<\/p>\n A BOK official told AFP on August 11 that roughly 500,000 users are set to conduct real-world transactions as part of testing before the end of 2026.<\/p>\n The official added that “existing regulations and personal data protections governing banks will be implemented for tokenised deposits”, such as the\u00a0 Personal Information Protection Act<\/a> and Credit Information Use and Protection Act<\/a> (archived here<\/a> and here<\/a>).<\/p>\n Privacy concerns<\/p>\n Proponents say digital currencies — which hold the same value as their paper money counterparts — help reduce transaction fees and enhance cross-border payment efficiency.<\/p>\n Central banks have cited the widespread decline in\u00a0 cash usage<\/a> as a key reason for studying the launch of digital currencies ( archived link<\/a>).<\/p>\n In South Korea, where less than a quarter<\/a> of transactions are made in cash, the BOK — which operates autonomously<\/a> under South Korean law — and\u00a0 financial regulators<\/a> have advanced research for CBDC projects since 2020 (archived\u00a0 here<\/a>, here<\/a> and here<\/a>).<\/p>\n But studies<\/a> have also suggested that poorly designed CBDCs could pose\u00a0 privacy risks<\/a>, increasing exposure to data leakages and cyberattacks (archived here<\/a> and here<\/a>).<\/p>\n “Neither the BOK nor the government can access, monitor or control the tokenised deposit status of an individual user”, the BOK said in a\u00a0 report<\/a> after the first phase of the pilot scheme ( archived link<\/a>).<\/p>\n Cha Hyeonjin, a professor at Hoseo University’s department of digital finance and management<\/a>, told AFP on August 4 that the pilot project “operates within the existing financial system” and “can not expose personal information” ( archived link<\/a>).<\/p>\n According to Lee, the pilot comes at ” an appropriate time” to discuss what data protection measures and cybersecurity safeguards should be put in place.<\/p>\n South Korea has not formalised plans to introduce a digital currency as lawmakers remain divided<\/a> over how broader digital assets should be regulated ( archived link<\/a>).<\/p>\n