Central bank digital currencies are slowly becoming a core area of development for nations all across the globe. South Korea is one of the contenders in the CBDC race and its Shinhan Bank is set to collaborate with the country’s central bank to issue a Korean CBDC. The bank will also be aided by tech giant LG.
According to recent reports from local South Korean news agencies, Shinhan bank is currently developing a CBDC version of Won in collaboration with LG Corporation’s IT services arm, LG CNS. Both the parties have previously worked together to build a pilot blockchain-based digital currency platform that will be used to distribute the CBDC.
“If the BOK issues a CBDC, an intermediary agency will be needed for the smooth distribution and use of digital currency,” a Shinhan bank official noted.
Korean central bank, the Bank of Korea (BOK), will use this digital currency platform to develop the digital won and Shinhan bank would be in charge of distributing that CBDC to the consumers. Individuals and affiliates will also be able to use the issued CBDC for payments, remittances, exchange, and recharge services.
The intermediary platform will also be blockchain-powered to ensure transaction stability. This would stand out to be the core difference between the digital won and China’s digital yuan. Unlike the digital Won, the digital yuan won’t be distributed using blockchain.