CBDC | South Korea plans to invite 100,000 citizens to use tokenized deposits for shopping.

According to reports from Korean media, South Korea is planning to invite 100,000 citizens next year to participate in a CBDC test, where they can use tokenized deposits to purchase retail goods. However, participants are expected to only be able to make payments using CBDC and will not be able to perform functions such as saving, trading, or sending money.

South Korea CBDC Experiment Project

Asian Countries Successively Engage

As cryptocurrencies become more widespread, many governments in Asia are accelerating the promotion of Central Bank Digital Currency (CBDC) compared to the closed and strengthened regulatory practices in Europe and America. Hong Kong, Singapore, and Japan have successively launched pilot projects to assess the risks of implementation.

South Korea Announces CBDC Experiment Project to Start in 2024

Not falling behind, the Bank of Korea (BOK) announced in early October this year that it will jointly release the South Korea CBDC experiment project with the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS), with the Bank for International Settlements (BIS) also providing technical advice.

The South Korean government's main focus for this project is to experiment with the application and technology of "tokenized deposits" in CBDC.

Tokenized deposits refer to the tokenization of transactions conducted through bank payment and transfer processes, such as card payments or checks, to reduce reconciliation time and the risk of fund loss during transactions, thereby enhancing transaction efficiency in CBDC use cases.

The South Korean government plans to conduct trials in the retail industry in 2024.

South Korea Plans to Invite 100,000 Citizens to Test Tokenized Deposit Shopping

According to reports from foreign media, the Bank of Korea will invite 100,000 South Korean citizens to use tokenized deposits to purchase goods for a period of three months starting in September 2024.

However, participants will only be able to make payments using tokenized deposits and will not be able to make additional deposits or trade with other individuals. The goal of this experimental phase is to evaluate the feasibility of actual token issuance and distribution.

First Large-Scale Testing Project

South Korea's cryptocurrency industry is thriving, with high public willingness to participate in the industry, prompting the government to promote CBDC.