Naver, Kakao, SK vie for Korean central bank’s digital currency pilot project

2021.07.13 13:03:46 | 2021.07.21 09:47:38

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South Korea’s household IT names Kakao Corp., Naver Corp., and SK Group are vying to win over the country’s pilot project on central bank digital currency (CBDC).

The Bank of Korea said Monday its tender to award the project has drawn Kakao’s Ground X Corp., Naver’s Line Plus Corp., and SK Inc. C&C.

The BOK will choose a company within the month to kick off a year-long mission next month.

Ground X is a blockchain technology firm under the country’s dominant chat app operator Kakao. Line Plus is affiliated with internet giant Naver, running an e-commerce platform and mobile payment system. SK Inc. C&C is an IT solutions unit under SK Group’s holding company.

Kakao and Naver had been keen on the project ever since the central bank unveiled the launch. SK joined later and set up a dedicated team for blockchain technology by inviting other fintech firms.

CBDC is a type of currency using an electric record to represent the digital form of a country’s currency, which could be used for a variety of purposes, such as paying for purchases and trading assets. The digital coin differs from other decentralized cryptocurrencies such as bitcoin as it would be issued and managed directly by a central bank.

The BOK’s year-long pilot project will be carried out in two phases to test CBDC’s technological feasibility and usefulness of the currency in virtually simulated markets based on distributed ledger technology until June 2022.

By Kim Jung-hwan and Cho Jeehyun

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