{"id":26576,"date":"2026-05-22T16:06:26","date_gmt":"2026-05-22T16:06:26","guid":{"rendered":"https:\/\/www.europesays.com\/korea\/26576\/"},"modified":"2026-05-22T16:06:26","modified_gmt":"2026-05-22T16:06:26","slug":"bok-governor-highlights-payments-innovation-ambitions","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/korea\/26576\/","title":{"rendered":"BoK governor highlights payments innovation ambitions"},"content":{"rendered":"

\"\"<\/a>Hyun Song Shin: wants to expand the use of CBDC and tokenised deposits I Credit: Daniel Bernard (Unsplash) & BIS<\/p>\n

Digital payments innovation including central bank digital currency (CBDC) and the internationalisation of the Korean won has been highlighted by the Bank of Korea (BOK)\u2019s new governor in his inaugural address.<\/p>\n

Hyun Song Shin, a well-known figure among central bankers globally via his innovation-related work in former roles at the Bank for International Settlements (BIS), was speaking to kick off a four-year term in the central bank\u2019s top job.<\/p>\n

He outlined four priorities: to conduct monetary policy with \u201cprudence and flexibility\u201d and continue efforts to enhance its effectiveness; to approach financial stability \u201cwith a new lens\u201d and \u201cstrengthen early-warning capabilities\u201d as the boundaries between banks and non-banks, and between domestic and cross-border activities, are \u201cblurring rapidly\u201d; to drive internationalisation and innovation; and to \u201cplay an active role in addressing structural reform challenges facing our economy.\u201d \u00a0<\/p>\n

The innovation-related priorities are consistent with Shin\u2019s work at the Switzerland-headquartered BIS, where he was part of the management team that created the BIS Innovation Hub (including acting as interim head at its launch in 2019). BOK is one of seven central banks involved in the Innovation Hub\u2019s major cross-border tokenisation initiative \u2018Project Agor\u00e1\u2019<\/a>\u00a0(Greek for \u2018marketplace\u2019) announced two years ago.<\/p>\n

\u201cThrough international cooperation, including Project Agor\u00e1, we will strengthen the role of the won in the digital payments environment,\u201d Shin \u2013 who had been closely involved with the project at the BIS \u2013 said in his speech (21 April).<\/p>\n

Global Government Finance\u2019s editorial newsletter (free): sign up here<\/a><\/p>\n

Internationalisation and innovation<\/p>\n

The third priority has the most obvious crossover with Shin\u2019s BIS innovation-related work.\u00a0<\/p>\n

\u201cPreserving trust in money and ensuring the integrity of payment and settlement systems is a key responsibility of central banks in today\u2019s globalised and digital financial environment,\u201d Shin \u2013 a former academic who worked as a presidential adviser in South Korea 16 years ago before joining the BIS \u2013 told the audience.<\/p>\n

\u201cThe internationalisation of the Korean won is a key task in building a monetary infrastructure commensurate with the stature of our economy,\u201d he continued. \u201cIn cooperation with the government, we will pursue 24-hour foreign-exchange market operations and establish offshore won settlement systems. This will improve the accessibility and resilience of foreign-exchange transactions, consistent with international standards. These efforts will support won-denominated capital and trade transactions, enhance the currency\u2019s international standing, and contribute to the orderly development of the foreign-exchange market.\u201d<\/p>\n

\u201cWe must also prepare in advance for the design of the future monetary system in response to digital financial innovation,\u201d he continued, cueing up a mention of \u2018Project Hangang\u2019<\/a>.<\/p>\n

Project Hangang (named after the river that flows through capital city Seoul) is a BOK pilot project testing a so-called \u2018unified ledger\u2019 integrating wholesale CBDCs and tokenised deposits. The concept of a unified ledger was first aired by then-BIS general manager Agust\u00edn\u00a0Carstens in a speech in February 2023 (it was then detailed in a special chapter of BIS\u2019s annual economic report in June 2023).<\/p>\n

RELATED ARTICLE\u00a0BIS releases \u2018game-changing\u2019 blueprint for global financial system<\/a>\u00a0\u2013 a news article\u00a0(20 June 2023)\u00a0on the special chapter of BIS\u2019s 2023 annual economic report detailing the unified ledger<\/p>\n

Project Hangang\u2019s evolution<\/p>\n

The BOK, Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) \u2013 in cooperation with the BIS \u2013 jointly announced a project to \u2018explore a future monetary system for Korea\u2019<\/a> in October 2023.<\/p>\n

A BOK and BIS joint report,\u00a0\u2018A step toward new financial market infrastructure: Bank of Korea\u2019s initiative\u2019<\/a>, was published the same month (October 2023). This specified four overarching objectives, including \u2013 at a general population level \u2013 deflecting Koreans\u2019 \u2018considerable interest\u2019 in cryptocurrencies.<\/p>\n

The BOK had already conducted CBDC experiments, with a focus on exploring a retail CBDC (a central bank digital currency for general population use).<\/p>\n

\u201cThrough the second phase of Project Hangang, we will expand the use of CBDC and tokenised deposits, and through international cooperation, including Project Agor\u00e1, we will strengthen the role of the won in the digital payments environment,\u201d Shin \u2013 who has succeeded Rhee Chang-yong as governor \u2013 said in his speech.<\/p>\n

\u201cAs safeguards are needed to ensure that the internationalisation of the won and innovation in the monetary system do not undermine financial stability, we will continue discussions on a macroprudential framework suited to this changed environment,\u201d he said. \u201cIn this way, we will work with the government to ensure that the internationalisation of the Korean won, payment and settlement innovation, and the macroprudential framework form a mutually reinforcing triad that generates synergies.\u201d<\/p>\n

RELATED ARTICLE South Korean authorities explore \u2018unified ledger\u2019 for CBDC<\/a>\u2013 a news story (18 October 2023) on the BOK, FSC and FSS joint-announcement<\/p>\n

Government expenses and blockchain<\/p>\n

South Korea\u2019s Ministry of Finance and Economy, meanwhile, is to test blockchain-based deposit tokens for government expenses, according to media reports.<\/p>\n

A blockchain is a shared, immutable digital ledger that records transactions across a decentralised network of computers<\/p>\n

The ministry is to run a pilot project to replace government expense (purchasing) cards with deposit tokens later this year, according to media including Korean-language digital news brand Khan<\/a> (Kyunghyang Shinmun) and EN-language online news source The Block<\/a> (16 April).<\/p>\n

A ministry press release (available in Korean only<\/a>) explained that, currently, government departments execute business spending and other related expenses with government-issued credit or debit cards.<\/p>\n

\u2018When processing expenses with deposit tokens, we can pre-set allowable usage times and permitted categories of spending, enhancing overall transparency,\u2019 the release stated.<\/p>\n

Experimentation will reportedly centre on Sejong City (Sejong-si), the purpose-built administrative \u2018smart\u2019 city that is home to the \u2018Government Complex Sejong\u2019.<\/p>\n","protected":false},"excerpt":{"rendered":"Hyun Song Shin: wants to expand the use of CBDC and tokenised deposits I Credit: Daniel Bernard (Unsplash)…\n","protected":false},"author":2,"featured_media":26577,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[456],"tags":[10293,17707,845,10423,534,846,1339,4557,17708,17709,2141,31,17710,1340,4107,10297,33,17711,17712,17713,14698,4484],"class_list":["post-26576","post","type-post","status-publish","format-standard","has-post-thumbnail","category-bank-of-korea","tag-bank-for-international-settlements","tag-bank-for-international-settlements-innovation-hub","tag-bank-of-korea","tag-bis","tag-blockchain","tag-bok","tag-cbdc","tag-digital-payments","tag-digital-won","tag-government-complex-sejong","tag-hyun-song-shin","tag-korea","tag-project-agora","tag-project-hangang","tag-sejong-city","tag-sejong-si","tag-south-korea","tag-tokenised-deposits","tag-tokenised-finance","tag-unified-ledger","tag-wholesale-cbdc","tag-won"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/26576","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/comments?post=26576"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/26576\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media\/26577"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media?parent=26576"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/categories?post=26576"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/tags?post=26576"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}