Bank of Korea creates asset tokenization unit in first reshuffle under Shin Hyun-song

The Bank of Korea has established a dedicated unit to pursue the tokenization of assets including government bonds, as part of the first organizational reshuffle carried out by Governor Shin Hyun-song since he took office four months ago.

The central bank also renamed its North Korea economy research office and reorganized units handling personal data protection and fiscal and industrial analysis.

According to documents submitted to People Power Party lawmaker Lee Jong-wook of the National Assembly's Finance and Economy Planning Committee, the Bank of Korea last month created a three-person Asset Tokenization Division under its CBDC Department.

The new division is tasked with planning projects to tokenize assets — including government bonds — using central bank digital currency infrastructure, and with conducting related policy research. The move is seen as laying the operational groundwork for issuing and distributing government bonds in digital token form.

Earlier, Shin had emphasized the need for government bond tokenization at an ECB forum held in Sintra, Portugal, on July 1. "If government bonds are issued and distributed directly within a digital currency system, a series of processes — from verifying collateral eligibility to redemption at maturity — can be handled automatically through smart contracts," he said at the time.

Observers say the new division could accelerate related business initiatives in the second half of this year, as the second phase of Project Han River gets underway in earnest.

Separately, the bank renamed the North Korea Economy Research Office under its Economic Research Institute to the Economic Security Research Office, citing the growing importance of economic security research. The six-person team will continue studying North Korea's economic trends and structure while also taking on research and investigation into economic security issues.

The Bank of Korea also created a three-person Personal Data Protection Division to strengthen its personal data oversight and management framework. The unit will plan and operate personal data protection work and handle related consultations and training.

The Standards Development Division, which had been responsible for introducing the international financial messaging standard ISO 20022 to the Bank of Korea Financial Wire Network, was dissolved following the completion of the first phase of that rollout. The four-person unit had been in charge of planning and building the ISO 20022 implementation.

Fiscal and industrial research functions also saw some adjustments. The existing Fiscal and Industry Team was renamed the Fiscal Analysis Team, while the Structural Analysis Team became the Industrial Analysis Team. The Fiscal Analysis Team will handle analysis of government budgets and expenditures along with fiscal research, while the Industrial Analysis Team will focus on industrial trends and policy, as well as research into structural economic change and growth potential.

The Non-Government Bond Team, which manages overseas assets, was renamed the Credit Securitization Bond Team to more clearly reflect the scope of its holdings, which include corporate bonds and mortgage-backed securities.

The Statistical Data Service Team was renamed the Statistical Platform Team to better reflect its platform-oriented work, which includes operating the economic statistics information system and providing statistical services to the public.