South Korea will test blockchain-based deposit tokens for government expenditures in Q4, potentially lowering transaction fees and reducing audit requirements

According to CoinDesk, South Korea’s Ministry of Economy and Finance announced it will launch a blockchain-based deposit token pilot in Sejong City in Q4 2026, replacing traditional government procurement card payments. The project has been approved under the 2026 regulatory sandbox program, permitting institutions to pay business promotion expenses in the form of tokenized deposits. Token payments can be pre-configured with spending limits and eligible industry scopes, helping reduce the need for manual audits and lowering transaction fees for small businesses by eliminating intermediaries such as card networks. This marks the second fiscal application of deposit tokens, following the first pilot conducted under an electric vehicle (EV) charging infrastructure subsidy program. If the pilot yields significant results, the Ministry of Economy and Finance plans to expand the program further.