South Korea to Pilot CBDC Experiment with 100,000 Citizens
South Korea is set to conduct a pilot project involving 100,000 local citizens who will be able to use central bank digital currencies (CBDCs) to purchase goods and services. The project is in collaboration with the Bank of Korea (BOK) and local financial authorities. Participants will use deposit tokens issued by commercial banks in the form of CBDCs, similar to using a voucher at a store.
Small Portion of the Population
While the pilot project is significant, it only represents a small portion of South Korea’s total population. The country has approximately 51.7 million people.
BIS Chief Calls for Rules for CBDCs
The Chief of the Bank of International Settlements (BIS), Augustin Carstens, has urged countries working on CBDCs to collaborate on defining a common framework of rules. Carstens believes that CBDCs require rules because money is a social construct.
Hong Kong and Visa’s Progress with CBDCs
Hong Kong is making strides towards launching its own CBDC, while global payments company Visa has collaborated with HSBC and Hang Seng Bank to test tokenized deposits with CBDCs. These developments highlight the growing interest and progress in CBDC adoption.
Hot Take: The Future of CBDCs
The pilot project in South Korea demonstrates the country’s commitment to exploring the potential of CBDCs. As more countries experiment with and develop their own digital currencies, it becomes increasingly important for collaboration and the establishment of common rules and frameworks. The rise of CBDCs could reshape the global financial landscape, offering new opportunities for innovation and efficiency in transactions.
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