Thousands of South Koreans will take part in the CBDC pilot project of the country’s central bank by using its deposit tokens to buy goods.
The Bank of Korea has joined the several central banks worldwide that are testing their CBDC pilots. With the bank’s own CBDC pilot project gaining pace, it has now announced a new initiative. Under its CBDC pilot project, around 100,000 South Koreans will use deposit tokens to buy goods. It could help understand the central bank digital currency’s (CBDC) feasibility.
Moreover, the project participants will only be able to use the tokens for payments, not storage or transfer. The Bank of Korea said, “The possibility of conducting separate pilots will also be considered if banks propose new individual projects.”
The Bank of Korea, the Financial Supervisory Service (FSS), and the Financial Services Commission jointly made the project’s announcement. An official of the Bank for International Settlements visited the central bank recently, after which they made the announcement. The official also appreciated the efforts of the bank and mentioned the CBDC as the ‘digital won.’
Meanwhile, the central bank of South Korea may also partner with the Korea exchange to test its digital currency. The central bank’s digital currency will also integrate into a simulation system for carbon emissions trading. With it, the bank will check the viability of delivery and payment transactions between the payment tokens and carbon emission rights.
Several reports mentioned the Bank of Korea explained the many benefits of a digital currency in the country. The bank will also conduct the CBDC pilot project in the fourth quarter of 2024. In October 2023, South Korea had seen discussions for crypto regulations. Further, a bank in South Korea had also undertaken a stablecoin remittance project.
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