Deposit tokens emerge as compromise between stablecoins, CBDCs

Deposit tokens are emerging as a new alternative to stablecoins and central bank digital currencies (CBDCs) amid prolonged legal uncertainty surrounding stablecoins, Digital Times reported. A deposit token is a digital asset issued by a bank based on its deposits, distinguishing it from other stablecoins. This development comes as the Bank of Korea's CBDC pilot, Project Han River, enters its second phase. Kyongnam Bank and iM Bank have newly joined the project, which already included Kookmin, Shinhan, Hana, Woori, NH Nonghyup, IBK, and Busan Bank from its first phase. The media outlet added that industry experts anticipate bank-based deposit tokens will likely serve a complementary role in circulation and payments even after a CBDC is introduced.