The Bank of Korea, the country's central bank, has just launched a pilot program to test the digital won, its own central bank digital currency (CBDC).
According to the official announcement, the tests began last month and are scheduled to continue until December 2021. The aim of the program is to identify the technical and legal provisions needed to design and issue a digital currency.
Several aspects will be analyzed during the tests. On the one hand, as far as technology is concerned, the program aims to define the design of the digital won and an operation method as well as to find out whether blockchain tech can be implemented.
From a legal point of view, the program will analyze the legal implications of the launch of this CBDC and will prepare the necessary amendments to the current Bank of Korea Act.
According to the official announcement, the program will be implemented as follows:
- CBDC design and requirements definition: 5 months (from March 2020 to July 2020).
- Tech review: 5 months (from April 2020 to August 2020).
- Business process analysis and consulting: 4 months (from September 2020 to December 2020).
- CBDC pilot system construction and testing: 12 months (from January 2021 to December 2021).
Although the country's central bank has said it believes it is not necessary to launch a DBDC, it does consider it necessary to be prepared for possible changes in the payments industry in the future.
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