South Korea’s Central Bank Starts Technical Phase for Digital Currency Ahead of 2021 Pilot

The Bank of Korea is moving to a more technical phase of its accelerated push to develop a central bank digital currency, or CBDC.

• The Korea Times reported Monday that the Bank of Korea (BoK) is now seeking a consulting partnership to bring the second phase of its CBDC plan to fruition.
• Once through the application process, the successful local company would assist the central bank in building the architecture for the CBDC, which is being prepared in the face of China's drive to be the first major nation to launch a digital version of its fiat currency.
• China's "DC/EP" digital yuan system is now in testing at banks and commercial enterprises in a number of regions.
• The first review phase of the BoK's work on a CBDC was completed last month, per the report, and the findings will feed the next stage of the work.
• The architecture would set out aspects of the planned system such as security, how data is handled and possible applications.
• The Times said a pilot is planned for late 2021.
• "The BOK will team up with a consulting partner to map out the overall work process and architecture to operate the digital currency system," a BoK official was quoted as saying.
• They would also arrive at "specific action plans" to deliver the pilot in time, they added.
• Will the development has been hastened this year, the central bank doesn't plan to launch a CBDC soon, but is rather preparing the ground for a time when other national currencies go digital.

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