South Korea has temporarily halted its next phase of the central bank digital currency project, signaling a cautious approach amid shifting priorities in the digital asset sphere.
CBDC Testing Suspension
The Bank of Korea (BOK) informed participating banks that discussions for the second phase of its CBDC testing, initially planned for later this year, will be paused for reassessment.
Political Focus on Stablecoins
This pause coincides with a growing emphasis on stablecoins under the newly elected President Lee Jae-myung. Shortly after taking office, Lee proposed easing issuance requirements to enable companies with as little as 500 million won (approximately $370,000) in equity to issue won-backed stablecoins.
Impact on the Cryptocurrency Market
South Korea remains one of the world's most active cryptocurrency markets, with around 18 million people—over a third of the population—engaged in digital asset trading. On peak days, trading volumes on local crypto exchanges surpass those of traditional stock markets such as the Kospi and Kosdaq.
This development underscores South Korea's careful navigation between advancing digital currency innovation and maintaining financial system stability.
