Seven South Korean banks to participate in CBDC-driven pilot

Seven financial credit institutions in South Korea have been authorized to participate in the pilot program testing CBDC-based digital financial services.

South Korea’s Financial Services Commission has authorized seven domestic banks to participate in a pilot program testing digital financial services based on central bank digital currency and deposit tokens.

The program, which FSC announced in its press release dated November 6, aims to explore the potential of CBDCs in daily transactions. Participating banks, including KB, Shinhan, Woori, and Hana, will issue deposit tokens representing digital assets backed by bank deposits, the press release states.

FSC notes that physical vouchers have traditionally been used to access public services. Now the country wants to use digital coupons stored in a distributed ledger to provide the same services more conveniently.

The pilot program also includes a digital coupon management platform that will allow the government to distribute and track coupons, according to the regulator. However, FSC did not specify a timeline for the project.

The country continues to strengthen its regulatory framework for the crypto market while developing its CBDC expertise. In October, crypto.news reported that South Korea plans to implement new regulations for cross-border virtual asset transactions, including cryptocurrencies, with updated registration and reporting requirements that will come into force in the second half of 2025.