The Bank of Korea is testing the central bank digital currency (CBDC) in the second half of this year.
Bank of Korea governor Joo-yeol Lee reported that he would strengthen the CBDC test and institutional and technical research by attending the National Assembly Planning and Finance Committee on the 23rd.
To this end, the Bank of Korea expanded the existing virtual currency research group into the digital currency research team as a way to expand professional manpower and dedicated organizations. The Bank of Korea secures a technological foundation through the digital currency research team, such as applying the distributed ledger technology, an important technology of CBDC.
Based on this, the Bank of Korea announced that it plans to build and test the CBDC pilot system in the second half of this year. An official from the Bank of Korea said, “The CBDC test will be conducted by setting various situations through simulation in a virtual environment.”
The Bank of Korea examines the impact of the CBDC on monetary policy, financial stability, and issuing services, and for international cooperation, the’Future of Payments’ Working Group of the Payment and Market Infrastructure Committee (CPMI), the Innovation Hub of the International Settlement Bank. ) I plan to actively participate in my’CBDC’ working group.
On the 8th, the Bank of Korea released a CBDC report stating that’CBDC can be recognized as legal currency (legal currency) rather than virtual assets (cryptocurrency).’ The report said that the CBDC has a different method of denoting currency from the existing currency, and it can give legal status because it can meet the requirements of the currency legislation, but it is necessary to revise the Bank of Korea law in order to issue CBDC.
DID standard establishment, stablecoin response
The Bank of Korea is also setting up a standard for Decentralized Identifier (DID) in the financial sector. Distributed ID is attracting attention recently as a useful technology for identification in non-face-to-face financial transactions. Currently, the Financial Security Agency and the Korea Internet & Security Agency (KISA) are also preparing for the establishment of the distributed ID standard in the financial sector.
An official from the Bank of Korea said, “The standardization of distributed ID financial security promoted by the Financial Security Administration is in terms of software (SW) technology and security.” “The Bank of Korea has standardized in terms of supporting the actual development of distributed ID service by financial institutions. It’s going to go ahead.”
In addition, the Bank of Korea plans to seek countermeasures for the spread of private digital currency such as stablecoins.
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