South Korea eyes September launch for second phase of CBDC pilot: Report
Stablecoins
The Bank of Korea is preparing to launch the second phase of its Project Hangang wholesale central bank digital currency (CBDC) pilot as early as September. This expansion increases the number of participating financial institutions from seven to nine, with the addition of regional lenders Kyongnam Bank and iM Bank. The pilot utilizes a blockchain-based wholesale CBDC as the primary settlement asset for deposit tokens issued by commercial banks. Building on the first phase, which saw 81,000 participants complete over 114,000 transactions, the new stage focuses on commercialization and practical utility. Key features being tested include government subsidy disbursements, peer-to-peer transfers, and biometric authentication. By integrating merchant partnerships, the project aims to bridge the gap between institutional blockchain infrastructure and everyday consumer payments. This development is significant for the RWA market as it demonstrates a sovereign-led framework for tokenized bank deposits, setting a precedent for how national currencies can be digitized for scalable, real-world financial applications.
Key points
- ▸Project Hangang expands to nine banks, adding Kyongnam Bank and iM Bank.
- ▸Phase two tests government subsidy disbursements using tokenized bank deposits.
- ▸First phase recorded 114,880 transactions across 81,000 participants from April to June 2025.
- ▸New features include peer-to-peer transfers, biometric authentication, and merchant integration.
Background
Project Hangang is a wholesale CBDC initiative led by the Bank of Korea designed to modernize the national payment infrastructure. It functions by using a central bank-issued digital asset to settle deposit tokens created by commercial banks, effectively tokenizing commercial bank money on a blockchain ledger.
Relevance
8.5/10