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The Bank of Korea and Korea Exchange signed an agreement to collaborate in exploring distributed ledger technology (DLT) and central bank digital currency (CBDC) for carbon trading. Simulated trials will take place in the third and fourth quarters of 2024. Both organizations already have related programs. The Korea Exchange is currently conducting simulated DLT experiments and plans to support listed security tokens next year. The central bank said this trial would form part of its CBDC usability tests. However, both the exchange and central bank emphasized this is just a test. It will not impact the functioning of current carbon credit markets. http://www.bok.or.kr/portal/bbs/P0000559/view.do?menuNo=200690&nttId=10080261&pageIndex=1

The Bank of Korea (BOK) will reportedly launch two wholesale central bank digital currency (CBDC) tests. The first will be a pilot in which banks will issue tokenized deposits as programmable vouchers, and settle them between each other using wholesale CBDC. This tokenized deposit pilot will involve up to 100,000 people starting in September or October 2024. The second test will be a proof-of-concept that will involve banks using wholesale CBDC to settle carbon credit transactions on the Korea Exchange. https://www.koreatimes.co.kr/www/nation/2023/11/602_363810.html

The Korean Ministry of Science and Information and Communications Technology (MSIT) and the Korea Internet and Security Agency (KISA) launched an investment project to promote the domestic blockchain industry. It is committing Won 20 billion ($14.5 million) across 14 projects, divided into two public sector and the private sector parts. One of the public sector projects includes the development of a wholesale central bank digital currency (CBDC)-based digital voucher management platform by the Bank of Korea. This platform will allow various voucher programs to be used on mobile devices, improving the efficiency and accessibility of digital payments. https://www.msit.go.kr/bbs/view.do?sCode=user&mId=113&mPid=238&pageIndex=2&bbsSeqNo=94&nttSeqNo=3184609&searchOpt=ALL&searchTxt=

The Bank of Korea has published the results of research it conducted last year on the legal issues surrounding central bank digital currency (CBDC). It concludes that the Bank of Korea Act would need to be amended to accommodate the issuance of a digital currency, because the act only accounts for notes and coins at present. However, CBDC would meet the requirements of currency legislation and could be freely exchanged with cash as the two share the same legal status. Therefore it would be reasonable to treat a CBDC in the same way as cash deposits held by financial institutions. http://www.bok.or.kr/portal/bbs/P0000559/view.do?nttId=10062857&menuNo=200690

Bank of Korea to Begin CBDC Pilot in April (BusinessKorea) The Bank of Korea (BOK) will reportedly launch its wholesale central bank digital currency (CBDC) pilot next month (April 2025). Participants will be able to convert their bank deposits into tokenized deposits and use them for payments at affiliated merchants. The purpose of the distributed ledger technology (DLT) based wholesale CBDC is to settle the tokenized deposit transactions across the seven participating banks. Currently, interbank transfers are settled via transfers across banks' BOK reserve accounts. To recruit approximately 100,000 pilot participants for the experiment, the BOK reportedly plans to issue a public announcement by the end of this month (March 2025).

At a briefing held at the Bank of Korea on April 21, 2025, Deputy Governor Lee Jong-ryul reportedly pointed out that the "Project Hangang River" three-month pilot that started on April 1, 2025, is more about experimenting with "deposit tokens," a stablecoin issued by domestic commercial banks, than the central bank digital currency (CBDC) issued by the Bank of Korea. As of April 20, 51,766 electronic wallets capable of using deposit tokens had been opened, and a cumulative total of 29,251 transactions had occurred from April 1 to April 20.

The Bank of Korea announced the completion of the first phase of its central bank digital currency (CBDC) proof of concept work, in which basic functionality (e.g., minting, issuance and distribution) were successfully simulated. In the next phase, other functions such as offline payments and adding personal information protection will be tested. After the second phase is completed in June 2022, a pilot may be launched in cooperation with financial institutions. https://www.bok.or.kr/viewer/skin/doc.html?fn=202201240938308670.pdf&rs=/webview/result/P0000559/202201

The Bank of Korea is reportedly launching central bank digital currency (CBDC) pilots in three regions (Jeju, Busan and Incheon). However, details are sketchy. https://it.chosun.com/site/data/html_dir/2023/07/31/2023073101135.html

The Bank of Korea (BOK) provided updates on its central bank digital currency (CBDC) proof-of-concept work in its 2022 Payment and Settlement Systems Report. This included investigating smart contracts, near-field communications (NFC) based offline payments and cross-border payments. Also, the BOK connected 14 banks with its simulated CBDC system to verify its functioning. It handled 2,000 transactions per second but slowed down as it reached capacity, so further improvements are needed. The bank also tested a zero-knowledge proof (ZKP) protocol to improve privacy, but it slowed the processing speed markedly. https://www.bok.or.kr/eng/bbs/B0000179/view.do?nttId=10078478&menuNo=400063

The Bank of Korea (BOK) is launching a CBDC pilot that will include private banks and public institutions, while the Bank for International Settlements (BIS) providing technical support. It will assess the viability of a future monetary system grounded on wholesale CBDCs, with key motivations to include testing wholesale CBDC as a settlement asset for commercial bank tokenized deposits, and exploring the BIS Unified Ledger concept. Banks will issue payment instruments in the form of tokenized deposits - that will be accessible to the general public - within the "CBDC network" established by the BOK, using distributed ledger technology (DLT), and managed by the BOK, Financial Services Commission, and the Financial Supervisory Service. https://www.bok.or.kr/eng/bbs/E0000634/view.do?menuNo=400069&nttId=10079839&pageIndex=1&

"The Bank of Korea completed the second phase of its retail central bank digital currency (CBDC) simulations in late June. While it was happy with some aspects of its digital won simulations, such as using CBDC for offline payments and cross border remittances, it found the overall performance of the Ethereum-based blockchain insufficient, including the scaling solutions and privacy technology that was tested. One of its tests simulated peak demand by sustaining 4,200 transactions per second (TPS) for 30 minutes. At that activity level, users sometimes had to wait up to a minute for a response (latency)."

North Korea is in the early stages of developing its own cryptocurrency. The goal is to avoid international sanctions and circumvent the U.S.-dominated global financial system.

According to its 2020 Payments and Settlement Report, the Bank of Korea will conduct simulation experiments for its CBDC in the second half of 2021.

South Korea's National Assembly is progressing a bill that will provide a legal basis for cryptocurrencies in the country. The bill categorizes virtual currencies as digital assets and intends to bring regulatory clarity and transparency to crypto markets in South Korea.

The Bank of Korea (BOK) has formed a legal advisory group to evaluate issues surrounding a potential central bank-issued digital currency launch. The group includes six experts; three professors, two lawyers and one BOK official. The panel will reportedly operate until May 2021, although the BOK's CBDC plans are not set in stone.http://www.bok.or.kr/portal/bbs/P0000559/view.do?nttId=10058761&menuNo=200690

South Korea will enforce a 20% tax on gains from crypto trading activities that exceed a $2,000 threshold starting from January 2022. It was originally going to come into force in October 2021 but was extended due to concerns raised by local industry players for not having enough time to build a proper tax reporting infrastructure.

LG CNS to develop CBDC system for Korean tokenized deposits The Bank of Korea (BOK) announced the award of a contract to LG CNS to develop and test wholesale CBDC systems. One of the tests involves banks issuing tokenized deposits and using a wholesale CBDC for interbank settlement. The other will use wholesale CBDC for securities settlement using distributed ledger technology (DLT) platforms. https://www.bok.or.kr/portal/bbs/P0000559/view.do?nttId=10081177&menuNo=200690

The Bank of Korea (BOK) "Project Hangang River" wholesale central bank digital currency (CBDC) backed tokenized deposit pilot is reportedly preparing to launch a second phase as early as October. The current three-month (April 1 to June 30, 2025) phase involves about 100,000 participants, and is limited to person-to-business (P2B) payments (for goods and services at online and offline merchants). In the next phase, person-to-person (P2P) transfers will be added, along with expanded use cases and a full rollout of a digital voucher program for welfare payments by local governments.

The Bank of Korea will reportedly launch a three-month central bank digital currency (CBDC) pilot involving 100,000 consumers, as early as this month (March 2025). It will involve seven major commercial banks that will issue deposit tokens backed by CBDC, which consumers can use to make purchases at various participating merchants. The tokens, valued up to 1 million won per person, will be distributed through electronic wallets, allowing users to make payments by displaying QR codes.

South Koreans are increasingly going cashless as more people turn to e-wallets in South Korea for both online and offline purchases.