The Bank of Korea has suspended its central bank digital currency (CBDC) trials as the government shows support for local currency stablecoins. The decision came as banks involved expressed concerns over the costs associated with the CBDC project, leading to dissatisfaction about the lack of a commercialization plan. During the first phase of the trials, 100,000 participants tested payments, but the banks now prefer to focus on issuing their own stablecoins, which could prove financially beneficial. Newly elected President Lee Jae-myung advocated for the issuance of stablecoins during his campaign, and a bill facilitating this process is under consideration. Multiple banks are collaborating to launch a won-backed stablecoin by next year. Following the suspension of the CBDC, shares in some fintech companies plummeted while others benefitted, indicating market sensitivity to these developments.

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