The Bank of Korea (BOK) is gearing up to launch a pilot program involving 100,000 participants in early April to test its central bank digital currency (CBDC) in real-world transactions.
Project Hangang, a three-month initiative running through the end of June, involves seven South Korean banks, including KB Kookmin, Shinhan, Hana, Woori, NH NongHyup, BNK Busan Bank, and the Industrial Bank of Korea.
Participants will convert deposits from traditional bank accounts into deposit tokens, which can be used for daily purchases at selected merchants through banking apps that utilize QR code payments. Individual token holdings will be capped at 1 million won (~$690), with a cumulative value of 5 million won for the pilot duration.
Per Korea Times, participating merchants include 7-Eleven, Hanaro Mart, Kyobo Bookstore, and Ediya Coffee, alongside online platforms such as Hyundai Home Shopping. The initiative is structured to evaluate the viability of CBDCs in simplifying current payment and settlement systems, potentially reducing transaction fees by enabling real-time merchant settlements.
The BOK plans to publicly solicit participants for Project Hangang later this month. According to a BOK official cited by Korea Times, the pilot aims to minimize intermediary roles within transactions, thereby assessing the practical efficiencies of a CBDC model over traditional banking processes.
This real-world testing phase builds upon South Korea’s prior CBDC research initiatives and marks a significant step toward CBDC integration into daily economic activity. The pilot aligns with broader global efforts spearheaded by institutions like the Bank for International Settlements (BIS), projecting widespread adoption of CBDCs in both retail and wholesale capacities by 2030.
The experiment represents an escalation from theoretical modeling to practical application, situating South Korea among an expanding group of countries actively evaluating the viability of CBDCs for retail use.
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