[2026 Parliamentary Audit] Shin Hyun-song on Distributed Ledger Security Concerns: “Institutional and Technological Advances Must Go Hand in Hand”

Comprehensive parliamentary audit of the Bank of Korea by the National Assembly's Finance and Economy Planning Committee

Bank of Korea Governor Shin Hyun-song said on Oct. 23 that “institutional safeguards must be accompanied by technological advances” to address distributed ledger security issues in “Project Hangang,” the Bank of Korea’s digital currency pilot program.

Shin made the remarks in response to a question from Lee Jun-seok, a lawmaker from the Reform Party, about distributed ledger security during a comprehensive parliamentary audit of the Bank of Korea by the National Assembly’s Finance and Economy Planning Committee at the National Assembly in Yeouido, Seoul, that day. “Technical and legal issues need to be further developed,” he said.

A distributed ledger is a technology in which multiple network participants, or nodes, jointly record and manage replicated, shared and synchronized digital data. Lee has raised concerns about whether the distributed ledger management structure can prevent the leakage of personal information, such as transaction records. His concern is that, because the system requires personal information to be linked to financial transactions under the real-name financial transaction system, banks jointly recording the ledger could allow them to see customers’ transaction information at other banks.

Citing materials submitted by the Bank of Korea, Lee said, “The response says that a transaction confidentiality feature considered by the Bank of Korea could not be applied because of processing performance. There are concerns that measures to anonymize personal information were not applied for the same reason.” Shin replied, “As technology advances, performance improves significantly.”

When Lee reiterated that “it is not enough to impose legal sanctions if a particular bank leaks a customer’s transaction information from another bank,” Shin agreed on the importance of security technology, saying, “That alone is not sufficient.”

Asked about the extent of cooperation with other central banks pursuing digital asset policies, including the Bank of Japan and the European Central Bank (ECB), Shin said, “Cooperation is underway. When blockchain first emerged, it was based on the concept of decentralization, with the principle that all information would be shared by everyone.”

The timing of the release of an incident response manual, close to the start of the second Project Hangang pilot, was also questioned. Lee said, “I was told that the second Project Hangang live transaction pilot is scheduled to begin at the end of this year, but that the incident response manual would not be released until the third week of December. We would have to launch the live service using this manual just one or two weeks later. I don’t understand.” He also requested a comparison table showing how Korea’s security level compares with that of other central banks. 

In response, Shin said, “As technology advances, security improves as well,” adding that “there is a trade-off between practicality and security.”  Asked to confirm who would conduct the security review for the second Project Hangang pilot, he replied, “I will.”

Bank of Korea Governor Shin Hyunsong answers lawmakers' questions during a comprehensive parliamentary audit of the Ministry of Planning and Budget, the Bank of Korea and other institutions at the National Assembly on Oct. 23, 2026. Photo by Yoon Dongju

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