The Bank of Korea (BOK) suspended its central bank digital currency project, Singaporean financial newspaper Business Times reported on Monday.
The project had reached the stage of developing a pilot program with participating banks.
The central bank told the banks it will pause discussions related to the initiative, according to the report, which cited an unidentified BOK official.
South Korea’s President Lee Jae-myung, who took office June 4, courted the country’s cryptocurrency community during his election campaign. Among his promises was a pledge to support a won-based stablecoin market.
Earlier this month, Lee’s ruling Democratic party submitted a bill that would allow qualifying companies to issue stablecoins.
CBDCs are a form of fiat currency that are meant to act as a digital counterpart to cash. They have been criticized as a concept, particularly among the crypto community, over concerns about privacy, surveillance and state control.
The Bank of Korea did not respond to CoinDesk’s request for comment.