South Korea has joined the growing list of countries exploring central bank digital currencies (CBDCs), with the Bank of Korea (BOK) initiating a pilot project aimed at assessing the technical infrastructure required for a digital currency. In a joint announcement made on October 4, the BOK, along with the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS), revealed their plans for the CBDC pilot.
The primary focus of this pilot project is to evaluate the feasibility of a potential future monetary system based on “wholesale CBDCs.” As is customary with CBDC trials, the BOK emphasized that this exploration does not necessarily guarantee eventual implementation. Nevertheless, the First Deputy Governor of the FSS, Lee Myung-soon, described the pilot as a significant stride towards shaping the future monetary landscape, stating:
“The BOK has persistently pursued technological research related to CBDC. This test, building upon past achievements, represents a significant step towards creating a prototype for the future monetary system.“
These sentiments echo those expressed by Denis Beau, the first deputy governor at Banque de France, on September 3, who referred to CBDCs as “the catalyst for improving cross-border payments by enabling the build-up of a new international monetary system.”
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