The BOK 2022 Installment and Settlement Frameworks Report is a forward-looking record with aggressive designs for monetary innovation in the country.
The South Korean National Bank has distributed its 2022 Installment and Settlement Frameworks Report. Oversight of the frameworks was done effectively, the Bank of Korea's report said, and it is preparing for a future with national bank computerized money (CBDC) and is examining stablecoin guidelines extensively.
The BOK-Wire+ quick installment framework will be moved up to constant gross settlement (RTGS) and has taken on the ISO 20022 norm, as most would consider it normal to be carried out in 2028, the report said. The bank will likewise expand oversight of Huge Tech installment administrations and develop its abilities to address IT functional risks.
The BOK proceeded with its arrangements for the possible presentation of a CBDC, which included researching the utilization of savvy contracts, disconnected installments with close field interchanges, and cross-line installments. The bank associated 14 banks and the Korea Monetary Broadcast Communications and Clearings Establishment with its mimicked CBDC framework for the last part of the year to check its functioning.
The framework took care of 2,000 exchanges per second. That figure is higher than most homegrown installment frameworks, the report noted, yet the framework dialed back as it reached its limit, so further upgrades are required.
The bank had a go at utilizing a zero-information confirmation convention to clear CBDC exchanges to work on their security. That permitted it to conceal the wallet locations and installment measure of the exchange, but it eased back the handling speed uniquely, and the security ramifications of a CBDC have not been explored. It said it might also consider homomorphic encryption.
Related: CBDCs ought to safeguard protection, not be an observation device. Previous CFTC seat
The BOK will move forward with CBDC research, with plans to take a gander at CBDC-based tokenized stores and expand the extent of the exploration with the banks and the clearings organization. It said:
“A key focus of the BOK’s research will be identifying a CBDC operating model with minimally adverse impacts on the stability of the financial system and on the effectiveness of monetary policy.”
The report noted substantial advancement toward crypto resource guidelines in the country with the presentation of the System Follow-Up on Computerized Resources Act; however, the administrative structure is still excessively fragmented for it to permit installments in digital currencies. The bank has likewise participated in conversations about stablecoin, as it has expressed over and over.
(DEREK ANDERSEN, CoinTelegraph, 2023)