A loud announcement was made recently by the central bank of South Korea, the Bank of Korea (BOK) stating that they are officially considering adopting cryptocurrencies and blockchain applications for the new project of creating a cashless society in the country. The information was published by the South Korean news agency, TokenPost which stated that the central bank currently invests in the opportunity for society to become entirely coinless.
According to the source, BOK announced about the official launch of the new cash-free society pilot project in its “2017 Payment Report”. In the report, the new strategy of the bank of exploring possible uses of blockchain and cryptocurrency is presented in detail. According to the information, BOK is considering applying blockchain and passwords to the payments. In the framework of the pilot project customers could deposit small change from everyday transactions and put them on a prepaid or mobile card. These amounts can be used at convenience stores, discount stores, and department stores.
The central bank reported that the new project has the main objective of providing high convenience to the customers as well as reducing the cost of producing physical currency. According to the official information, South Korea spent about $47 mln on issuing physical currency in 2016.
In addition the bank already established a specialized organization which aims on researching digital currency and analyzing possible effects of cryptographic money on the overall financial system in the country. Analyst at Shinhan Investment Corporation, Kwak Hyun-soo expressed an official opinion on the new technology stating that it can also help opening the underground economy, and thus enhance equivalence in taxation.
The official announcement also confirmed that as planned by the government, the phasing out of physical money in the country began in 2016 and by 2020 the country plans to become an entirely cash-free society.