The Central Bank of South Korea included Kyongnam Bank and iM Bank in the pilot implementation of the digital won project, increasing the number of commercial bank participants to nine. These studies carried out with digital won focus on large-scale applications in the real world as we move into the second phase of the project.
What’s Tested in the New Phase of the Pilot
The first phase established the technical foundations of the digital currency infrastructure. The second phase aims to run the pilot on an operational scale and test certain usage scenarios that were not addressed in the first phase. One of the most important goals is to distribute the 110 trillion won subsidy provided by the state treasury through digital deposit tokens. The Central Bank plans to ensure that the funds distributed through this method are spent transparently and for their intended purpose. Programmable money makes it possible to implement such purpose-oriented spending conditions.
Another main goal of the pilot is to reduce transaction fees. It is being examined whether both large-scale businesses and small tradesmen can accept payments with digital money and whether this will significantly reduce costs compared to credit card infrastructure. Especially for small-scale companies, credit card commissions pose a serious burden on profitability.
At this stage, direct transfers from user to user are also added. This feature, which has not been fully implemented in previous trials, aims to make digital won a more functional tool in retail payments.
Another step towards the future was the integration experiments with artificial intelligence representatives. During the pilot process, autonomous AI agents that can independently make payments with digital won are being tested. This usage is still at an early stage and its commercial path is not finalized, but it indicates that the bank is preparing for an infrastructure beyond what it has today.
Nine Banks and 100 Thousand Participants
Banks within the scope of the pilot project include the following institutions: KB Kookmin, Shinhan, Woori, Hana, NH Nonghyup, IBK Industrial, BNK Busan, Kyongnam Bank and iM Bank. Real transactions will continue until the first half of 2026 with a selected 100 thousand participants.
The participation of Kyongnam and iM Bank not only provides a numerical increase, but also tests the application in terms of regional and customer diversity. By including these banks, different customer profiles and infrastructures compared to large national banks are evaluated in the pilot application. Thus, the pilot’s functionality can be measured more broadly through diversified data.
Regulatory Background and Accelerating Project
Uncertainties regarding the country’s digital asset regulation were effective in expanding the scope of the digital won pilot. There are disagreements among regulators over South Korea’s Digital Asset Basic Law, particularly regarding the issuance of stablecoins. This delay in the legislative process has created a gap in the digital finance infrastructure.
In response to this gap, the Central Bank is accelerating the commercialization of deposit tokens issued through banks. Deposit tokens, built on wholesale central bank digital money infrastructure, offer tighter supervision and control compared to stablecoin alternatives issued by private companies. With the progress of the pilot application, the Central Bank aims to standardize its own infrastructure in digital payments throughout the country.
This approach carried out by the center is considered as a strategy to highlight a self-centered digital money system before the final legal framework of stablecoins to be introduced to the market is determined.
