Blockchain, Cryptocurrency, Economy

2021: South Korea Will Start To Test The CBDC Waters

The South Korean central bank, the Bank of Korea (BOK), has advertised that it is to begin a central bank digital currency (CBDC) pilot next year, in connection with notable firms and domestic banks.

As reported by the Seoul Shinmun and the Fourth Journal, the BOK has stated that it has finished the design and “technical checks” on the digital won and is currently on the “second phase” of its project, a rigorous analysis of processes and “external consulting” with private-sector firms.

The BOK said that the token would be distributed “through financial institutions” such as banks in the “same way” that cash is circulated.

The BOK is yet to publish an exact timeline for its pilot but explained that it would create public-private collaborative testbed conditions for the digital won, with “private institutions” charged with distributing the tokens. A small number of companies are set to accept payments in the new currency.

front view of the door of a bank vault (3d render)

No report has yet been released about the banks’ possible identity and private sector companies that will take part in the pilot. Still, a local banking professional familiar with the matter has told CryptoNetwork.News that there has been no shortage of interested parties making their intentions known to the BOK – particularly within the banking community.

Numerous South Korean banks have already begun to develop products and services that would be compatible with a digital fiat, including wallets and advanced banking apps capable of processing digital fiat transactions.

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