The Bank of Korea (BOK) is preparing to initiate a pilot program in early April, involving 100,000 participants, to test its central bank digital currency (CBDC) in real-world transactions. Named Project Hangang, this three-month initiative will run through the end of June and includes participation from seven South Korean banks: KB Kookmin, Shinhan, Hana, Woori, NH NongHyup, BNK Busan Bank, and the Industrial Bank of Korea.
Participants will convert traditional bank deposits into deposit tokens, which can be used for everyday purchases at selected merchants through banking apps with QR code payment features. Individual token holdings will be limited to 1 million won (approximately $690), with a cumulative value cap of 5 million won for the duration of the pilot. According to Korea Times, participating merchants include 7-Eleven, Hanaro Mart, Kyobo Bookstore, and Ediya Coffee, as well as online platforms like Hyundai Home Shopping.
The initiative aims to assess the viability of CBDCs in streamlining current payment and settlement systems, potentially lowering transaction fees by enabling real-time settlements for merchants. The BOK plans to publicly invite participants for Project Hangang later this month. A BOK official, cited by Korea Times, stated that the pilot seeks to reduce intermediary roles in transactions, thus assessing the practical benefits of a CBDC model over traditional banking processes.
This phase of real-world testing builds on South Korea’s previous CBDC research efforts and represents a significant step toward integrating CBDCs into daily economic activities. The pilot is part of global efforts led by institutions like the Bank for International Settlements (BIS), which anticipate widespread CBDC adoption in retail and wholesale capacities by 2030. The experiment transitions from theoretical modeling to practical application, positioning South Korea among a growing number of countries actively exploring the retail use of CBDCs.
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