BOK to organize taskforce for CBDC research

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By Park Jae-hyuk

The Bank of Korea (BOK) said Friday it will organize a taskforce dedicated to central bank digital currency (CBDC) research for a better understanding of crypto assets that have drawn keen attention from central banks worldwide.

In its "Monetary Policy for 2020," the BOK said it will continue to build on the research into innovations, such as distributed ledger technology, crypto assets and CBDC, playing an active role as overseer to enhance security of the settlement systems.

The central bank also said it will recruit additional CBDC experts.

"We will actively engage in discussions with the Bank for International Settlements (BIS) and other international organizations, keeping an eye on CBDC development at other central banks," the BOK said in the report.

On Dec. 10, the BOK posted a job opening for digital currency experts.

In addition, Hong Kyung-sik, head of the central bank's payment and settlement systems department, said Dec. 18 that the BOK "is considering issuance of digital currency."

These have led experts and media to assume the BOK has begun developing technologies needed for the issuance of CBDC.

The central bank, however, has taken a cautious stance on CBDC, denying rumors that it will launch a digital currency soon.

"We just plan to strengthen our efforts for CBDC research," a BOK spokesman said.

Other central banks in major developed countries have been showing interest in CBDC since Facebook touted its Libra crypto-currency project and the People's Bank of China decided to circulate digital currencies as legal tender.

Bank of France Governor Francois Villeroy de Galhau said the central bank will begin testing a CBDC in the first quarter of 2020.

Reuters quoted the European Central Bank as saying: ""If industry efforts fall short of developing an innovative and efficient pan-European payment solution, the social need for it could potentially be met by issuing a central bank digital currency."

The United States Federal Reserve posted a job opening in November to hire a new manager to research digital currencies.

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