The Bank of Korea (BOK), in cooperation with the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS), plans to start a central bank digital currency (CBDC) pilot project with 100,000 citizens participating starting next year.
According to the Korea Times, the planned launch comes amid a meeting scheduled today between Bank of Korea Governor Lee Chang-yong and Bank for International Settlements (BIS) General Manager Augustin Carstens.
Karstens called CBDC a “digital currency” and praised the central bank’s efforts to embrace the future monetary system.
The latest development follows plans announced by the BOK last October to launch real-world CBDC trials wholesale, in collaboration with BIS and other agencies.
100,000 participants
The Korea Times reported that about 100,000 citizens will participate in the pilot program and be able to purchase products with ‘deposit tokens’ issued by commercial banks in the form of CDBC. The function was compared to being similar to using a voucher in a store.
Participants will be selected by selected commercial banks and recruited between September and October next year, with a three-month pilot project limited to specified payment purposes only.
An official from the Bank of Korea said, “We plan to first implement a pilot project in the fourth quarter of 2024 after consultation with related organizations and review of related laws,” and added, “If banks propose new individual projects, we will also consider conducting a separate pilot project.” said. .
The Bank of Korea said digital currencies can effectively address a range of issues prevalent in current voucher systems, including those used for special subsidies and government-provided child care during the COVID-19 pandemic, mitigating high transaction fees, delayed payment times, and the risk of fraudulent activity. suggested. .
In addition, the Bank of Korea plans to verify the feasibility of new financial products through technological experiments, such as integrating CBDC into the carbon emissions trading simulation system.
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