The Bank of Korea (BOK), South Korea’s central bank, is in the process of forming a task force to study the central bank digital currency (CBDC).
The prospect was revealed by the regulator on Friday on a report titled “Monetary Policy 2020.”
According to the report, BOK would build on its existing research into distributed ledger technology, crypto assets, and CBDCs and to play an active role in overseeing and enhancing the security of payment and settlement systems.
Bank governor Lee Joo-Yeol had previously told executives that turning away from the change could risk losing the trust of the nation. No one wants to lag behind as Asia continues to lead the way in digital payment innovation.
The Bank of Korea has previously published a paper earlier this year exploring the impact on the financial system a CBDC would have. As part of its CBDC research agenda, BOK ostensibly plans to recruit additional experts in the field. On Dec. 10, the institution had posted a job listing for digital currency experts, according to a report from the Korea Times.
A CBDC is a digital currency issued by a central bank, which has the status of legal tender and other properties of centralized, fiat money.
The Rise of CBDC
The year 2019 saw many central banks dived into the idea of launching a CBDC. Central banks of Switzerland, Canada, and Singapore, all have started exploring the use of digital currencies and their research efforts underway. China, however, appears ready to be the first to launch a government-backed cryptocurrency, with plans to have its own Digital Yuan up and running in 2020.