The South Korean government plans to allocate 25% of its $499.2 billion (approximately 728 Trillion Won) through digital assets by 2030. A substantial portion of the national treasury funds is expected to be distributed as deposit tokens, starting with subsidies in the EV sector in 2026.
The South Korean government is set to include the Digital Currency Utilization Plan for Advanced National Treasury Fund Management in the 2026 Economic Growth Strategy. The SK government aims to incorporate the Bank of Korea’s experimental central bank digital currency (CBDC) payment system, “Project Hangang.”
According to the Bank of Korea, the project tests whether bank-issued deposit tokens on the central bank’s blockchain platform can be circulated and redeemed. It also tests whether deposit tokens can be limited in usage as a form of vouchers. The government is expected to use deposit tokens for vouchers and subsidies within the first half of 2026 to shorten settlement periods and prevent fraud.
South Korea’s government to revise digital assets laws
The South Korean government is expected to revise the current National Treasury Fund Management Act to establish a legal framework for deposit token distribution and payments. The Act excludes deposit tokens from the definition of the national treasury funds.
The SK government also plans to expand the distribution of deposit tokens and payment infrastructure to include electronic wallets that can store these tokens. It will link the deposit token system with the National Fiscal Integrated Information System (dBrain) to digitize the execution, distribution, and settlement of the national treasury fund.
Meanwhile, an official from the Ministry of Economic and Finance revealed that the SK government is considering linking deposit token systems with retail store POS (Point of Sale) systems. It aims to establish a regulatory framework to institutionalize stablecoins after the Virtual Asset Phase 2 Bill (Digital Asset Basic Act) is finalized.
“We plan to use fiscal policy more proactively to drive a major transformation.”
–Koo Yun-cheol, Deputy Prime Minister and Minister of Economy and Finance
The South Korean Financial Services Commission is also expected to lead the follow-up legal revisions, with the country’s National Assembly currently reviewing a proposal that requires stablecoin issuers to maintain a capital of ~$3.43 million (~5 billion KRW). The issuers are also expected to deposit 100% of issued balances in government bonds, which are highly liquid reserve assets.
BOK revives CBDC program for subsidy distribution
The Bank of Korea (BOK) recently announced that it is reviving its CBDC program to help test the distribution of subsidies. The second phase of the temporarily suspended CBDC experiment was delayed by discussions on the Korean Won stablecoin bill.
An official from the Economy and Finance Ministry also stated that the ministry is reviewing how stablecoins could be used or restricted in foreign exchange transactions. The ministry aims to push for regulatory revision this year and specify the direction these legal revisions will take.
Meanwhile, the second phase of the Hangang Project is expected to focus on distributing government subsidies. South Korea allocated nearly $7 billion (~10.3T KRW) in cash handouts and over $400 million in regional gift certificates to promote local spending.
A BOK official also stated that the Hangang Project will help boost the South Korean government’s efficiency in distributing funds while reducing distribution and management costs. The SK government currently distributes subsidies using credit cards linked to residents, local government-issued vouchers, and bank accounts. However, local lenders have started preparing for the new CBDC pilot program. Many have also set up systems to support the distribution of the digital Won.
South Korea’s CBDC project has been paused at least twice since the first pilot four years ago. The recent pause followed the new administration’s shift in focus to stablecoins, which also led to the renaming and refocusing of the original CBDC team.
