The Bank of Korea (BOK) has recently awarded a contract to LG CNS to develop a wholesale central bank digital currency (CBDC) system. The contract is a result of BOK’s plans, announced last October, to conduct two wholesale CBDC trials. The first trial will explore the use of a wholesale CBDC for interbank settlement involving tokenized deposits. The second will focus on employing the wholesale CBDC for securities settlement using Distributed Ledger Technology (DLT) platforms.
The project involving tokenized deposits is particularly ambitious, set to involve 100,000 participants and expected to begin between September and October 2024. LG CNS’s contract will run until March 2025 and is funded with a budget of KRW 9.68 billion ($7.45 million). LG CNS’s involvement in digital currency development is not new. In 2020, they collaborated with Shinhan Bank to develop a blockchain-based digital currency platform, a precursor to a potential retail CBDC.