South Korea Launches $6.9M CBDC Deposit Token Payment Network for Businesses

TLDR

• South Korea launches $6.9M CBDC deposit token payment network nationwide.

• Project Hangang expands into commercial payments through existing banking rails.

• Nine banks and eight payment firms join the blockchain payment project.

• Deposit tokens aim to reduce payment costs for small business merchants.

• Government extends CBDC payment infrastructure into public finance services.

South Korea has started a 9.6 billion won ($6.9 million) project to expand deposit token payments across commercial businesses. The initiative extends the Bank of Korea’s Project Hangang into everyday payment services using existing banking infrastructure. Moreover, the program aims to reduce payment costs while supporting wider blockchain adoption across the domestic economy.

Deposit token network expands Project Hangang into commercial payments

The Korea Internet & Security Agency and the Ministry of Science and ICT launched the project on July 22. They introduced the initiative during a joint ceremony at KISA headquarters in Seoul. The government selected the project under its 2026 Blockchain Innovation Leading Project program.

The program promotes large-scale blockchain demonstrations with practical public and commercial applications. This year’s selected project focuses on expanding deposit token payments for businesses and consumers. Authorities expect the system to lower payment processing costs for small merchants.

The Korea Financial Telecommunications and Clearings Institute will lead the consortium managing the project. Nine commercial banks, eight payment gateway companies, and two large merchants will participate in the demonstration. Together, they will develop payment services using deposit tokens connected to the Bank of Korea’s wholesale CBDC platform.

Existing payment infrastructure supports wider deposit token adoption

The project will connect the existing payment network with the Bank of Korea’s Project Hangang infrastructure. Banks can process deposit token transactions without building a separate payment network. The approach also allows participants to rely on existing banking systems throughout the pilot.

Consumers will make payments through deposit token wallet applications issued by participating banks. Officials are reviewing physical payment cards linked to those wallets. Merchants can continue using current point-of-sale terminals without replacing existing hardware.

Authorities expect the model to improve settlement speed while reducing payment fees for businesses. Furthermore, the government plans to expand deposit token use into public finance operations. Officials intend to connect the technology with South Korea’s dBrain digital treasury platform for selected government spending programs.

Blockchain strategy extends beyond retail payments

The Ministry of Science and ICT allocated about 3 billion won for development, operations, and promotional activities. Small businesses, startups, and information technology companies will participate in those activities. Meanwhile, participating banks plan separate investments worth approximately 4.5 billion won for related infrastructure projects.

The payment initiative follows broader discussions about commercializing deposit token services after Project Hangang. Planned upgrades include person-to-person transfers, business treasury payments, and additional merchant participation. Besides that, banks expect future services to require anti-money laundering tools, fraud monitoring, and stronger operational systems.

South Korea continues separating deposit tokens from privately issued stablecoins despite their shared blockchain foundations. Deposit tokens represent commercial bank deposits issued through the central bank’s wholesale CBDC framework. Meanwhile, stablecoins operate under different regulatory structures backed by reserve assets instead of the Bank of Korea’s wholesale CBDC model.