Bank of Korea announces plan to test wholesale CBDC

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Bank of Korea announces plan to test wholesale CBDC
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The Bank of Korea plans to begin a wholesale central bank digital currency pilot in partnership with the Bank for International Settlements.

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The Bank of Korea plans to begin a wholesale central bank digital currency test in partnership with the Bank for International Settlements and other institutions.details of the experiment, with its primary focus being the feasibility of a future monetary system built upon wholesale CBDCs.will test whether a wholesale CBDC can be used as a settlement asset for commercial bank tokenized deposits. The scheme will also experiment with the programmability of tokenized deposits.

The BoK has already conducted retail CBDC trials but determined that a retail CBDC is not currently necessary due to the efficiency of the Korean payment landscape.

According to the BIS's unified ledger blueprint, the concept will utilize smart contracts to eliminate free-riding and contribute to the stability of bank funding. “A smart contract could specify that each participant contributes only a certain amount to a joint venture if all other participants also contribute, this way, free-riding is eliminated,” the BIS

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