Bank Of Korea Reports Successful First Phase Test For Their CBDC Journey
The Bank Of Korea (BOK) reports a successful first pilot test of the issuance and distribution of their central bank digital currency (CBDC).
According to the statement Bank of Korea will have the central bank digital currency testing program ready by June of 2022.
After completing the principal phase of its two-part mock test of the CBDC in December, BOK has now moved onto its subsequent stage after concluding the testing of the first stage “smoothly”. The first phase of testing started back in August last year.
Once the second stage of testing is completed BOK will be able to start distributing and launching the CBDC.
In the first phase of testing, the central bank had tested certain basic functionalities of the digital currency, mainly issues around the distribution and issuance of the currency. The first stage also was concerned with problems encountered while manufacturing the Digital Currency and running it in a simulation environment before launching this new form of money.
Bank Of Korea expressed interest in expanding the scope of the CBDC after final completion of the first-stage testing. It aims to expand by incorporating and cooperating with financial institutions.
The central bank commented in a press release:
“We will confirm the possibility of operating various functions, such as offline settlements, and the application of new technologies, such as one intended to strengthen privacy protection during the second phase of the test.”
After the results of the first phase of testing, BOK also specified its plans of incorporating other plans such as offline payments and also including personal information protection enhancement technologies.
The second phase of testing will now study and assess all the necessary technology which will be required for its final launch. This mainly will include wiring and payment in an offline environment along with testing cross-border and trading of the CBDC. Post the completion of the second phase of testing, BOK would be carrying out an inspection by conducting usability research in conjunction with financial institutions.
