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Fire damaged Buffalo Bill restore

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Buttstock is more or less complete minus a little touch up work. Installing the buffleheads bill token created a tad bit of finish damage. It was a press fit and pushed the wood causing a slight wrinkle on one side.
 
What type wood bit to recess the medallion?
I have a 1922 Walking Liberty silver dollar heavily damaged on obverse but looks BU on the face. I want to put it in the side of an old 1922 22lr stock I have.

Forstner bit maybe?

Stock was factory cut for the medallion/token.

But yes a forstner bit would be the one.
 
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