BOK cools expectations around issuing digital currency
![Bank of Korea officials speak in a press conference held to discuss central bank digital currency at the bank office in central Seoul on Thursday. [BOK]](https://koreajoongangdaily.joins.com/data/photo/2023/10/05/0006e59e-b8ca-46b4-9e56-bafcc91f00b6.jpg)
Bank of Korea officials speak in a press conference held to discuss central bank digital currency at the bank office in central Seoul on Thursday. [BOK]
The Bank of Korea (BOK) reiterated on Thursday that it does not have specific plans to issue central bank digital currency (CBDC), a day after it announced plans to test the commercialization of the digital currency.
“Issuing CBDC has various issues that need to be decided on based on the situation in key countries,” said Kim Dong-sup, director at the BOK's Digital Currency Research Division during a press conference held at the BOK headquarters in central Seoul.
The BOK does not find it necessary to quickly push the issuance of CBDC. Kim added that the goal of its CBDC project is to be “technologically prepared as we cannot be sure when it will be adopted in the rapidly digitized economy. Or else, it could create major confusion.”
Bahamas and Nigeria are some of the countries that have issued CBDC.
The BOK announced on Wednesday it will cooperate with Korean financial regulators and the Bank for International Settlements (BIS) in testing the commercialization of CBDC with the goal of developing a future monetary system.
The plans for the CBDC pilot project, which will involve participation from both the public and private sectors, involve the establishment of the relevant system and then testing it on ordinary users in the fourth quarter of next year.
CBDC could reduce the commission fee generated from credit card usage and also enable the use of smart contracts, reducing the imbalance of information between sellers and buyers.
“We’re taking our first step in preparing for the infrastructure of the future digital financial system,” said Ryoo Sang-dai, senior deputy governor at BOK on Wednesday. “BIS has paid great attention to our experiment as Korea has advanced IT technologies and citizens use various means of payment systems.”
The BOK initiated research on CBDC in 2020.
BY JIN MIN-JI [jin.minji@joongang.co.kr]
with the Korea JoongAng Daily
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