A recent report reveals that South Korea’s first central bank digital currency (CBDC) pilot, known as Project Hangang, was conducted without any independent security audit during or after its live phase, raising alarms as the program prepares for a major expansion. The only formal evaluations were carried out before launch by the internal teams of participating banks—Woori Bank and NH Nonghyup Bank—with assistance from the Financial Security Institute and SK Shields, according to documents submitted by the Financial Supervisory Service to the office of representative Lee Hun-seung on July 20.
During its first phase (April–June 2025), the pilot processed 114,880 transactions across roughly 81,000 digital wallets and 12,000 merchants, yet only 42% of users successfully completed a payment. Participating banks invested between 30 and 35 billion won in infrastructure. The Bank of Korea defended the absence of external inspections by citing a footnote in its pilot report stating that pre-launch evaluations were sufficient. However, Maeil Business Newspaper noted that the operator was effectively left to assess its own security—a practice an industry official criticized as undermining public trust.
On July 15, the Financial Services Commission approved the second phase, which will scale the trial to nine banks, up to 500,000 users, and raise the individual wallet limit from 1 million to 10 million won. New features include person-to-person transfers, biometric authentication, automatic top-ups, and—most controversially—programmable government subsidy payments. This capability allows the state to dictate when, where, and on what subsidies are spent, intensifying warnings that the CBDC is morphing into a financial control architecture rather than a simple payment upgrade. As one official put it, “The real-transaction pilot is a process of building public trust, not just technological verification,” underscoring the tension between innovation and oversight.
