BOK (Bank of Korea) is planning to establish its CBDC pilot system this month and test the CBDC in a virtual environment in the second half of this year.
According to Business Korea, BOK governor Lee Ju-yeol said last week (23 February) that the central bank has almost completed the design and technical study of its CBDC.
However, the BOK does not intend to rush into the issuance and pilot of a CBDC before undertaking comprehensive legal and regulatory assessments on the possibility of issuing a digital won.
Lee said the BOK is working on the legal reviews. Last month, the BOK called for a review of the legislative framework to enable the issuance and use of a CBDC in South Korea.
According to local reports, the BOK is unfazed by central banks in other jurisdictions like China which are rolling out CBDCs, and is in favour of a steady approach similar to that of the US.
“Even if the technical verification is completed in China, it is expected that it will take a cautious step toward full introduction,” Lee said.
Separately, South Korea is reportedly planning to tax investors who make more than KRW 2.5 million (USD 2,260) from cryptocurrency trading starting next year. The first KRW 2.5 million will be tax-free, but any gains exceeding this threshold will be subject to a 20 percent tax.
Inheritances and gifts of cryptocurrency will also be taxed, the MOEF (Ministry of Economy and Finance) says.
The changes are said to be part of the annual tax code revision approved by the National Assembly last December.