South Korea Pauses CBDC Development to Prioritize Won-Backed Stablecoins
South Korea's central bank has suspended its digital currency pilot as regulators shift focus to private stablecoin issuance. The Bank of Korea informed participating institutions that Phase 2 testing under 'Project Han River' WOULD be delayed indefinitely, originally slated for late 2025.
Commercial banks reportedly raised concerns about implementation costs and unclear monetization pathways. The pivot reflects growing regulatory preference for overseeing private-sector stablecoins rather than developing a sovereign digital currency.
Authorities are advancing legislation under the Digital Asset Basic Act to establish licensing frameworks for won-pegged stablecoins. The proposed rules mandate reserve requirements and consumer protections for issuers.
