BOK to Use Wholesale CBDC, Not Stablecoins, in 2027 Tokenized Treasury Bond Pilot

The Bank of Korea (BOK) has announced plans to utilize a wholesale central bank digital currency (wCBDC) as the primary settlement asset for its upcoming tokenized Treasury pilot scheduled for 2027. By opting for a central bank-issued digital currency over private stablecoins, the BOK aims to minimize counterparty settlement risk and guarantee settlement finality for government bond transactions. This initiative seeks to modernize the issuance and distribution of conventional government bonds by leveraging blockchain technology to enable simultaneous ownership transfers and payments. The BOK is currently coordinating with the Ministry of Economy and Finance, the Financial Services Commission, and the Korea Securities Depository to address the necessary legal and technical frameworks. Simultaneously, the central bank is expanding its existing Project Hangang pilot, which will now include nine participating banks and increase the user base to 500,000 participants. The project budget for Project Hangang has seen a significant 61.8% increase to 12.52 billion won, reflecting the bank's commitment to testing deposit tokens for government subsidy payments. While the specific integration between Project Hangang and the Treasury pilot remains undecided, these efforts represent a major institutional push toward integrating blockchain into national financial infrastructure. This development is significant for the RWA market as it signals a preference for sovereign-backed settlement assets in large-scale government bond tokenization projects.