South Korean Hana Bank and Woori Bank have begun exploring so-called certificate of deposit tokens. Institutions see them as an alternative to stablecoins and CBDCs, writes Maeli Business News Korea.
Tokenized CDs can become a substitute for regular cash and bank deposits without negatively impacting the financial system. Similar products will require KYC to the same standards as any institution service, according to a Woori Bank report.
Hana Bank plans to release a similar study soon.
Interest in the above-mentioned analytics tools was associated with the negative reaction of regulators to the problems of a number of stablecoins last year.
“Tokenized CDs are perceived by banks as a reliable asset because they are no different from the current system,” the report says.
The product has the potential to be compatible with CBDC. Both institutions are participating in testing this possibility in a test run under the auspices of the Bank of Korea.
In July, the regulator announced the continuation of preparations for the potential implementation of the digital won. The current stage includes exploring the use of smart contracts, offline payments using NFC technology and cross-border payments.
Recall that in June 2023, the South Korean Parliament passed a law on the protection of users of digital assets. The impetus for his approval was the collapse of the Terra ecosystem, which was supported by a citizen of the country, Do Kwon.
The document brought together 19 different bills related to cryptocurrencies. It introduces the concept of “digital assets” and defines liability for offenses such as the use of insider information, market manipulation and unfair trading practices.
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