The Bank of Korea (BOK) Tuesday said it is premature to issue the central bank digital currency (CBDC). However, it would monitor what impact cryptocurrencies would have on the economy.
Assistant BOK Governor Shin Ho-soon said, “At this stage, the need to issue the CBDC is not necessary.” “Before issuing the CBDC, you must check whether the society is ready to accept the digital currency and whether benefits exceed costs,” he added.
He said the possibility of cryptocurrency getting used wider and competing with the legal tender is low. However, the central bank has been studying blockchain technologies, he added.
The statement showed a subtle change of attitude toward the CBDC. Just a few months ago, the central bank was quite negative toward the digital currency and cryptocurrencies. It never mentioned its research on blockchain technology, which is necessary to issue the CBDC.
In a report, the central bank said that mobile device-based banking services have been on an explosive rise. Besides, Internet-based banks, which have no physical branches, would start a business.
It warned against the ‘mobile banking risk,’ meaning loss of mobile devices, including smartphones, illegal settlements, and online voice phishing and frauds would rise.
A BOK economist said hackers attacked unspecified banks and individuals. Currently, banks manage well online settlement risks. However, banks must in close contact with computer service providers against any mobile banking risk, he added.
