Bank of Korea to begin testing CBDC

South Korea’s central bank, Bank of Korea (BOK) which had earlier established a central bank digital currency (CBDC) pilot program, has now announced that it planned to speed up the process by starting to test its digital token from next year onwards. 

The central bank maintained its original stance that although it was hastening the development of its own CBDC, the BOK would only prepare to launch its digital currency only in the event that other nations digitize their currencies as well.

In fact, the central bank of South Korea said that the pilot program “is not a confirmation,” that it would actually “launch a digital currency.” Meanwhile, South Korea’s counterpart, the central bank in China has even started major trials in the case of its digital currency electronic payment, dubbed DC/EP, in four major cities earlier this year.

In fact, the People’s Bank of China held trials of its digital yuan on private platforms and even had a soft launch of its CBDC wallet on a banking mobile app that was quickly taken down. So far, the Chinese central bank has also used $162 million worth of its CBCD for its own pilot transactions.

But this current announcement implies that the BOK has reached its final phase of the aforementioned pilot program. This last part of the program will involve the distribution of the digital currency and oversee its circulation process.  The previous phases drew in outside consulting to design and check the technology backing its digital currency.

According to a local news source, the Korean Herald, BOK will incorporate blockchain technology to keep track of digital currency transactions, but it has not yet disclosed the tech partner the bank has selected for the process. 

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