12-30-2019 icon

South Korea to Setup Task Force for Digital Currency Research

By Sagetwriter

High Points

  • South Korea discusses CBDC for 2020.
  • Central Bank of Bahamas begins pilot testing of digital currency.

The Bank of Korea (BOK) – South Korea’s Central Bank will constitute an organized task force to undertake a central bank digital currency (CBDC) research slated for the new year.

IMF Expert Discusses Central Bank Digital Currency

BOK in its “Monetary Policy for 2020” publication (page 10) said it will continue to build on its existing research focused on distributed ledger technology, cryptocurrency assets, and CBDCs; adding that it will play an active role in supervising the security of payment and settlement systems.

As part of the Apex bank’s CBDC agenda, the BOK is reportedly also recruiting digital currency experts as seen in a recent job listing by the bank.

The bank says it will also engage other international central banks to keep up with developments and discussions relevant to the research.

Central Bank of Bahamas begins Pilot Testing of Digital Currency

The Central Bank of Bahamas (CBOB) will introduce a digital version of the Bahamian dollar under a pilot project.

According to an official release by the bank, the central bank digital currency (CBDC) dubbed “Project Sand Dollar” will be Bahamas first digital currency; and will kick of test of the CBDC in the country’s Exuma district before expansion to Abaco (a group of islands in Northern Bahamas).

CBOB says the initiative is aimed at the financial inclusion of citizens through easy access to efficient and non-discriminatory financial services.

The Bank goes on to publish a document on the challenges of cash usage and how the proposed Sand Dollar would effectively strengthen the nation’s financial system.

A snippet of the document reads:

“Cash usage also imposes physical security risks on businesses and creates more exposure to fraudulent losses relative to electronic point of sales transactions. As it relates to physical safety, a widely adopted CBDC would also place users at less risk of violent crimes that target holders of cash, and potentially reduce security and insurance costs associated with keeping cash on business premises.”

It will be recalled that the CBOB governor – John Rolle had in October described digital currency as a perfect replacement for the country’s dependence on cash, especially useful after a natural disaster.

“It would permit wireless restoration of payments connectivity, avoiding the cash shipment and cash handling frustrations. It would permit electronic dispersing of aid and allow families to recapture personal dignity by restoring the flexibility to prioritize the elements of a personal need that they prefer to satisfy post-disasters, he said.”

Would the new decade see cryptocurrencies and CBDCs become day-to-day currency? Share your thoughts in the comments.