The Financial Services Commission of South Korea has approved the second phase of Project Hangang, the central bank's experiment with digital payments based on CBDC. The maximum number of user wallets will increase from 100,000 to 500,000, and the number of participating banks will rise from seven to nine.

Expanded testing may begin in September, according to Decrypt. The limit applies to wallets, not unique users. Participants will not directly own the CBDC; instead, they will receive deposit tokens issued by commercial banks for transactions.

Regulator Raises Limits

In the second phase, the storage limit will increase from 1 million to 10 million won per wallet. The total transaction limit will rise from 5 million to 100 million won.

For individuals and sole proprietors, transfer limits will be set as follows:

  • up to 1 million won per transaction;
  • up to 5 million won per day.

For companies, limits will depend on the method of transaction. Through internet banking, transfers can be up to 1 billion won at a time and up to 5 billion won per day; via mobile app, the limits will be 100 million and 500 million won, respectively.

The approved feature set will also include wallet-to-wallet transfers, biometric transaction confirmation, and automatic top-ups of deposit token balances. In the latter case, if funds are insufficient, the system will automatically convert the necessary amount from the user's regular bank account.

For companies, remote wallet opening and the ability to issue cash receipts will be available. The list of acceptance points will expand to include small businesses and large enterprises.

Nine Banks Join the Experiment

Joining the seven banks from the first phase—KB Kookmin Bank, Shinhan Bank, Woori Bank, Hana Bank, Nonghyup Bank, Industrial Bank of Korea, and BNK Busan Bank—will be Gyeongnam Bank and iM Bank.

The commission has granted the two new participants the status of experimental financial service operators. For the other seven banks, the regulator has modified the conditions of previously issued permits to align with the parameters of the second phase.

The first phase of Project Hangang ran from April to June 2025. Users opened approximately 81,000 wallets and completed 114,880 transactions.

CBDC Remains at the Banking Level

Project Hangang employs a two-tier model. The Bank of Korea issues wholesale CBDC for transactions between financial institutions.

Commercial banks create deposit tokens based on this infrastructure—digital representations of funds already in clients' accounts. These tokens are used by customers for purchases and money transfers.

Thus, the deposit token remains a liability of a specific commercial bank, while the CBDC is used for final settlements between financial institutions.

The second phase will also extend to the execution of certain government expenditures. Smart contracts will allow deposit tokens to be transferred directly to recipients and set conditions for their use.

It is worth noting that in July, South Korean authorities planned a pilot for tokenized government bonds by 2027. Settlements for these bonds will be linked to the wholesale CBDC within the Project Hangang infrastructure.