Sources: South Korea's central bank plans to restart CBDC testing

According to reports from Decenter citing sources, the Bank of Korea has recently sent a formal document regarding the second round of CBDC testing to major banks. A Bank of Korea official stated, "Details including specific methods and timelines are currently under discussion." The second round of testing is considering the distribution of some government subsidies in the form of digital currency.

The aim is to use CBDC to restrict the use of subsidies and reduce the management and administrative costs associated with subsidy distribution. The Bank of Korea previously launched a three-month CBDC pilot project in April, involving seven participating banks, but later suspended the project. At that time, the pilot project was criticized for its limited practical application value and the burden of costs amounting to billions of Korean won on participating banks.