Korean internet services company Naver is set to take part in the Bank of Korea’s (BOK) central bank digital currency (CBDC) tests. Its participation is set to serve as an advantage when the government selects private-sector partners in issuing the currency.
CBDC is a term used to distinguish the digital currency of central banks from those of the private sector. Central banks around the world are currently developing and testing digital currency. As a frontrunner, the People’s Bank of China has launched testing of its digital currency in cities such as Suzhou, Shenzhen and Chengdu.
The BOK is preparing to test its CBDC in the latter half of this year. The central bank will run tests checking the utility and stability of the digital currency in a virtual environment. This simulation seeks to determine whether CBDCs can function, by running tests in manufacturing, issuing, circulating and redeeming the currency.
The BOK will involve information technology firms and financial institutions of the private sector to provide technological assistance for the trial run.
Naver’s subsidiaries Naver Financial and Line Plus are taking part in the BOK’s trial. Line Plus is an affiliate of Naver’s Japanese subsidiary Line. Line Plus operates Line’s businesses in Korea.
Line Plus provided consulting for the BOK last year in setting up its CBDC pilot system. Line operates virtual currency exchanges in Singapore, Japan and the U.S.
Naver Financial is in charge of the portal giant’s financial services business here, including its online-based payment system Naver Pay.
Read more: https://www.koreatimes.co.kr/www/tech/2021/05/129_308825.html?KK
