South Korean Central Bank Aims to Establish Its First Cryptocurrency i.e. CBDC

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Central Bank of South Korea i.e. the Bank of Korea (BoK) is aiming towards developing and establishing its very first cryptocurrency. For this purpose, BoK is in the process of shortlisting potential partners through which it can execute its plan of South Korean digital currency. The private financial institutions in the country have also raised concerns over the possibility of them working side by side with the South Korean crypto trading platforms and exchanges.

For the time being BoK is looking at the possibility of establishing its very first cryptocurrency. For doing the needful, the bank has been searching for a suitable candidate in the shape of a tech supplier. Once the shortlisting process is completed, BoK would enter into a partnership with the tech company for the project. Bidding advertisements and documents will be published and made available once BoK is able to obtain permission from the country’s executive.

It was informed by BoK that the tech company would be entrusted with the task to initially develop a test platform. If the test results are born fruit, only then proper South Korea’s official CBDC will be launched.

BoK has apparently been following in the footsteps of the many central banks of the world who too are working on their own CBDCs. For instance, China is currently in the lead of others as it has already developed and tested its CBDC and the same is available to the public. While in the US, the Administration there is still focusing on infrastructure development. However, the US Administration has categorically said that it will be developing its own CBDC in a matter of time.

Similarly, various other European, as well as the countries like India too, are exploring the possibility. While Russia’s CBDC is expected to be launched for testing very soon.

On the occasion, a BOK official stated that in the past two years there is a significant decline in cash-based transactions in the country. He added further that the initiatives taken by BoK are aimed towards early adoption of the changes and advancements.

The local news media also took notice that BoK’s decision regarding CBDC has stemmed from private banking institutions. It was noted that the private banks have grown concerns about working side by side with the crypto exchanges. This implied refusal of South Korean private banks has compelled BOK to look for alternatives.

Even otherwise, South Korean BoK would also like to run with other states with regard to their CBDC initiatives. In addition, the country is also hosting one of the greatest numbers of crypto users. While South Korean daily crypto trade volume is better than most of the European countries as well. In these circumstances, one cannot ignore an industry that too can help the state to generate a fair amount of revenues.