Consumer tech giant samsung We are considering issuing a central bank digital currency in cooperation with the Bank of Korea.
A South Korean electronics company announced Monday that it has signed a memorandum of understanding with the country’s central bank to conduct technological research on digital currencies.
Samsung said CBDC, which refers to digital currency issued by the central bank, works “offline” and can be sent and received between Galaxy smartphone and smartwatch owners because the devices have secure chips.
Samsung says it will be able to make payments between devices by using short-range wireless technology built into smartphones to enable contactless payments.
Samsung said last year that it had developed a solution that applied NFC technology to CBDC. This will allow users to make payments even without an internet connection, the company added.
Samsung said in a press release on Monday that the company, together with the Bank of Korea, “will continue to research ways to minimize the security risks associated with offline payments and support reliable transactions in emergency situations, even without network connectivity.” Stated.
“We are very pleased to be the first central bank to partner with Samsung Electronics to develop offline CBDC technology,” Bank of Korea Chief Deputy Governor Seung-hong Lee said in a press release.
He added, “Through the establishment of this MOU, we hope that South Korea will continue to lead in the field of offline CBDC technology, which is being actively researched by central banks around the world.”
“This collaboration with the Bank of Korea enables us to apply Samsung’s advanced security innovations to the digital currency space,” said Won-Joon Choi, executive vice president of mobile experience at Samsung. .
“We hope that our cooperation will make a valuable contribution to the advancement of global offline CBDC technology,” he added.
Countries from China to the United States are researching and experimenting with so-called CBDCs in hopes that they could enable consumers to send money instantly.
China has already created a digital version of the Chinese yuan and is piloting CBDCs in many cities, and the US is also closely monitoring whether and how it will work with a digital version of the dollar. are considering.
The practicality of issuing CBDCs has been questioned by some critics, given the ease with which remittances can be made through currently available methods such as online banking, money transfer apps and cryptocurrencies.
Various privately-developed digital currencies now also allow people to make payments almost instantly.But the majority of tokens are like Bitcoin Highly volatile. Stablecoins have been touted as a potential solution, but governments are wary of tokens issued by private companies.
Still, there remains a distinct headache for businesses when it comes to instant settlement of transactions. Due to the way banking systems are set up, it often takes several days for payments from merchant customers to actually clear.
This problem is something that private companies and governments want to address through new technologies such as blockchain and digital currencies.
