The Korean won is one of Asia's older currency names, but the modern South Korean won (ISO code KRW) only dates from a 1962 currency reform. Its story runs through the late Korean Empire, a short-lived currency called the hwan after the Korean War, decades pegged to the US dollar, and the dramatic 1997 Asian Financial Crisis that pushed the won into a free float. This guide walks through that history in order, keeping the facts general where exact figures are uncertain.
The word won derives from a Chinese-rooted character meaning "round" — written historically as 圜 and today as 원 in hangul. It shares this origin with the Japanese yen and the Chinese yuan, all three of which trace back to the same character for a round object. The name reflects the round shape of the metal coins that circulated across East Asia. So when you read "won," "yen" and "yuan," you are really looking at three regional pronunciations of one ancient idea: round money.
The first Korean currency to carry the won name appeared around the turn of the 20th century, during the era of the Korean Empire. This early won circulated in a period of intense outside pressure on Korea, and the country's monetary system was reshaped during the subsequent decades of Japanese colonial rule, when the Korean yen was used. After liberation in 1945 and the division of the peninsula, a won was reintroduced in the South. That first modern-era won did not last long: the upheaval of the Korean War (1950–1953) and the inflation that followed made a currency reform necessary.
In 1953, in the closing stages of the Korean War, South Korea replaced the won with a new unit called the hwan as part of a currency reform and redenomination. The change was meant to bring some stability to prices badly disrupted by the war. The hwan, however, also struggled against persistent inflation through the 1950s.
By the early 1960s the authorities decided to reset the currency again. In 1962, South Korea returned to the won, redenominating at a rate of 10 hwan = 1 new won. This 1962 reform is the birth of the modern South Korean won that is still in use today. From that point on, the won has been South Korea's continuous currency, issued by the central bank.
For much of the period after the 1962 reform, the won was tied closely to the US dollar. Through the decades of South Korea's rapid industrial growth, the exchange rate was managed by the authorities rather than left to the open market, with the won held at or around official levels against the dollar. Over time, and especially from the 1980s onward, Korea gradually moved toward a more flexible, managed-float arrangement, in which the rate was allowed to move within guided bounds rather than fixed outright.
The decisive break came at the end of the 1990s. During the 1997 Asian Financial Crisis, capital fled the region, the won depreciated sharply, and South Korea turned to the International Monetary Fund (IMF) for a large support programme. In the aftermath, the won effectively became a freely floating, market-determined currency, with its value set by supply and demand in global currency markets rather than by an official peg. That free-float framework is the basis of how the won trades today.
This shift had a lasting effect on how Koreans and foreign investors experience the currency. Before the crisis, the exchange rate was relatively stable because the authorities defended it; afterwards, the won could swing meaningfully from year to year in response to global events. In the decades since, it has tended to trade in a broad band against the dollar, strengthening when Korea's export-heavy economy — led by electronics, semiconductors and cars — performs well, and weakening when global investors retreat from riskier assets. The won is now widely traded, though it remains less internationally circulated than reserve currencies such as the dollar, euro or yen.
The Bank of Korea, the country's central bank, is the sole issuer of won banknotes and coins and the body responsible for monetary policy. Over the years it has redesigned and reissued the currency several times. A notable modern milestone was the introduction of the ₩50,000 banknote in 2009 — the first new high-value denomination in decades, featuring the historical figure Shin Saimdang. Before that, the ₩10,000 note had long been the largest in everyday circulation, which had made large cash payments cumbersome.
It is worth being clear about one point that often causes confusion: North Korea has its own, completely separate won. The North Korean won carries the ISO 4217 code KPW, while the South Korean won is KRW. The two are different currencies, issued by different authorities, and they trade independently. Everything on this page — and across fxkrw.com — refers to the South Korean won (KRW).
A simplified chronology of the major turning points in the currency's history:
| Year | Event |
|---|---|
| Around 1900 | First won introduced during the Korean Empire era. |
| 1910–1945 | Korean yen circulates under Japanese colonial rule. |
| 1945–1950 | A won is reintroduced in the South after liberation and division. |
| 1953 | Currency reform: the won is replaced by the hwan after the Korean War. |
| 1962 | South Korea returns to the won, redenominating at 10 hwan = 1 won — the modern KRW begins. |
| 1960s–1980s | The won is managed against the US dollar during rapid industrialisation. |
| By the late 1990s | Move toward a managed and then freely floating exchange rate. |
| 1997–1998 | Asian Financial Crisis: the won falls sharply; South Korea takes an IMF programme. |
| 2009 | The Bank of Korea issues the ₩50,000 banknote. |
The name "won" comes from the Chinese-derived character meaning "round" (圜, later written 원 in hangul), the same root that gives the Japanese yen and the Chinese yuan their names. It originally referred to the round shape of metal coins.
The hwan was the South Korean currency used between 1953 and 1962. After the Korean War it replaced the first won in a currency reform, and in 1962 South Korea returned to the won, redenominating at a rate of 10 hwan to 1 new won.
The modern South Korean won dates from the 1962 currency reform, when the hwan was replaced by the won at 10 hwan to 1 won. This established the won (ISO 4217 code KRW) that is still issued today by the Bank of Korea.
No. North Korea has its own separate won (ISO code KPW), which is a different currency from the South Korean won (KRW). This page covers the South Korean won; the two are not interchangeable and trade independently.
During the 1997 Asian Financial Crisis the won depreciated sharply and South Korea received an IMF support programme. Around this time the country moved away from a managed exchange rate toward an effectively free-floating, market-determined won.
The Bank of Korea, the country's central bank, is the sole issuer of South Korean won banknotes and coins. It manages monetary policy and introduced higher-value notes such as the 50,000 won banknote in 2009.