In February, it set up a research team to look into a South Korean digital currency.

The Bank of Korea has commissioned a legal task force to assess regulatory roadblocks for the issue of a South Korean central bank digital currency (CBDC). (The Korea Times)

Last February, the Korean central bank had set up a research team to look into the possibility of a digital currency and assess moves in this regard by other central banks. Chinese advances towards a digital yuan, including a pilot test, reportedly triggered the move. It may be recalled that the Bank of Korea said on December 1 that “we are considering issuing digital currency (CBDC).”

Bank of Korea CBDC – fast forward in April

In April, the Bank of Korea shifted gears after observing that neighbor Japan and ally the United States were making serious moves towards digital currencies.

The bank launched a 22-month pilot program designed to ascertain the viability of issuing digital currency to replace physical cash. The pilot would also assess all the technical and legal ramifications of the proposed step.

Now – a multidisciplinary legal team

The legal advisory team commissioned Monday by the Bank of Korea comprises six experts from the finance and IT sectors. It also includes one expert from the bank’s legal policy office.

Professors of commercial law and fintech lawyers are also said to be part of this team.

The tenure of the think tank will commence Monday, and last till the end of May 2021.

“We established the advisory group to discuss legal issues surrounding a CBDC and figure out which laws need to be revised or enacted for smooth progress in the BOK’s possible issuance of digital currency,” an official from the Bank of Korea said.

China could be the first off the mark with a CBDC

Meanwhile, Glenn Woo, Ledger Vault’s head of the Asia-Pacific region, is of the opinion that China will be first off the block with a state-backed virtual currency. Speaking to Coin Telegraph, Woo said China was the world leader in progress towards the implementation of a CBDC.

Domestically, China will quickly expand current pilots into much larger, countrywide tests. Once implemented, “no one is going to even know the difference,” Woo said.

“[F]rom the retail user’s perspective, [you] wouldn’t necessarily know what has changed — it’s going to be the same,” said Woo. “They will still use WeChat, the super-app, to do a lot of different things — shopping, calling cabs, transferring money, you know, giving out the red packets during the holidays, and so on.”

The Bank of Korea certainly appears to be trying to make up for lost time on its CBDC.

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