◆ BOK, CBDC virtual environment test within this year
On the 23rd, the governor of the Bank of Korea Lee Ju-yeol said in a work report by the National Assembly Planning and Finance Committee, “CBDC is preparing as scheduled and plans to conduct (pilot) tests in a virtual environment within this year.” Governor Lee said, “We plan to strengthen research on the institutional conditions and technological feasibility underlying the issuance of CBDC.”
In its business report, the BOK said, “We have secured the technical foundation of CBDC through testing of distributed ledger technology while expanding professional manpower and dedicated organizations (digital currency research team and technology group).”
Through external consulting to be completed at the end of March, the CBDC pilot system will be established, and tests will be carried out in a virtual environment in the second half of the year. The BOK announced that it will closely examine its impact on monetary policy, financial stability, and ticketing services, and will actively participate in international discussions.
The BOK will hold discussions with the’Future of Payments’ working group of the Payment and Market Infrastructure Committee (CPMI) and the’CBDC’ working group within the Innovation Hub of the International Settlement Bank. In addition, when the use of private digital currency such as stablecoin is spread, it plans to analyze the impact that may have on payment and settlement and seek countermeasures.
The BOK is also pursuing the establishment of a Distributed ID (DID) standard in the financial sector in order to activate digital identity verification that can secure and facilitate identity verification in non-face-to-face financial transactions.
◆ Fed Chairman “The Digital Dollar Issue, We Will Cooperate with the Public”
Fed Chairman Jerome Powell attended a hearing on the House Financial Services Commission on the 24th (local time) and said, “We will cooperate with the public on the digital dollar issue.”
He responded this way to the digital dollar concept questioned by Congressman Patrick McHenry. “This will be an important year (for the digital dollar),” Powell added. “This will be a year for the Fed to engage with the public quite actively.”
Chairman Powell said he would collect opinions (related to digital dollars) through a public event. The Block reported that he did not explain in detail, but said the Fed was working hard to organize such an event.
However, the Fed has no intention of announcing an official digital dollar plan to the public yet. Chairman Powell said that as legal and technical issues with CBDC still remain, the public will listen to opinions on matters rather than comments on ideas.
He noted that the Fed is looking for a solution to a confirmed technical problem with the digital dollar. To this end, he said it is also in discussions with other central banks that are researching or issuing CBDC.
“The digital dollar is a high-priority project,” Powell responded to questions raised by Senators Cynthia Lumis and Senators Bill Hagerty about the progress of the CBDC during a Senate hearing.