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[Alpha Biz=(Chicago) Reporter Kim Jisun] The Bank of Korea is speeding up its experiment to introduce the Central Bank's Digital Currency (CBDC). CBDC refers to a new currency in digital form issued directly by the central bank.
The Bank of Korea announced on the 4th that it will jointly carry out experiments ("CBDC utilization test") to build future monetary infrastructure with the Financial Services Commission and the Financial Supervisory Service by the end of next year.
The experiment will be carried out as a public-private joint project jointly conducted by banks as well as the Bank of Korea and financial authorities. The Bank of Korea has also worked closely with the Bank for International Settlements (BIS) since the experimental planning stage.
The experiment will focus on 'institutional CBDC’' used for financial transactions and final payments between financial institutions. Banks trade funds with deposits (reserves) in accounts opened at the central bank, and the core of the experiment is to implement them in CBDC.
During the fourth quarter of next year, the general public will also participate in the actual transaction test to experience the utility of digital currency. However, only banks participate in this experiment in consideration of the current law. Afterwards, whether to expand gradually or not will be decided later after comprehensively reviewing related institutional issues.
AlphaBIZ 김지선(stockmk2020@alphabiz.co.kr)
