South Korean Central Bank Sets Up A CBDC Advisory Group for Digital Won

With governments of major global economies mulling the idea of central bank digital currencies (DBDCs), the Asian economic giant South Korea is working on the similar path. South Korean central bank - Bank of Korea - has recently appointed a legal advisory which will study all matters and issues relating to the feasibility of launching the Digital Won.

The group consists a six member team of people coming from different financial background including a BoK official, two lawyers, and three professors. The group will study the developments in the crypto space and advice new legislations and amendments required to introduce a CBDC in South Korea’s economy.

So far, the Bank of Korea has not launched any specific guideline for the launch of the Digital Won. However, the panel will be reportedly working up to May 2021. If required, the panel can seek extension for the study to a later date.

Earlier this year, the Bank of Korea (BoK) approved a pilot program for launching the central bank digital currency (CBDC). Started in April 2020, the central bank confirmed that the pilot program will run to a minim of 22 months till December 2021.

But the South Korean central bank has clarified that the pilot program will only check the limitations of launching a digital currency and give a better idea of where the currency market is moving in the future.

Back in December 2019, even the South Korean monetary regulator hinted about their interest in CBDC. As said earlier, major economies across the globe are experimenting with the idea of having a CBDC.

The reason behind this accelerated development is that the popularity of public cryptocurrencies is growing due to the powerful blockchain technology supporting it. However, this decentralized cryptocurrencies reduce the importance of central banks in the global money transfer process.

Countries like France, U.S, U.K are all working on the idea of having a CBDC. China has been the front-runner in this game and has been pushing its CBDC project with much speed. It is very much possible that China can release its own CBDC before the end of 2020. With its CBDC, China is making all plans to take-on the United States and emerge as the next dominant force in the global financial ecosystem.