Samsung Electronics recently announced a partnership with the Bank of Korea (BOK) to jointly conduct research to develop an ecosystem for a Central Bank Digital Currency (CBDC). Both parties have signed a memorandum of understanding (MOU) with the goal of studying the CBDC issued by the BOK and collaborating in the offline payment sector.
CBDCs are digital currencies issued by central banks, and numerous countries, including the US, are exploring the launch of their own CBDCs to enable more transparent and secure transactions. The BOK Deputy Governor Lee Seung-heon highlighted the significance of BOK being the first to develop offline CBDC technology with Samsung Electronics, hoping that Korea takes the lead in this area, as central banks worldwide are actively exploring the option.
Samsung had previously participated in a BOK-led CBDC pilot project last year, during which it developed offline CBDC technology that allowed device-to-device transfers and payments through near-field communication (NFC), even without internet connection. This technology is made possible by a chipset with advanced security features built into Samsung’s mobile devices.
With the MOU in place, Samsung and the Bank of Korea will also focus on enabling users to make payments using Samsung’s Galaxy smartphones and Galaxy Watch, even in situations where online networks are unavailable, such as during disasters. Samsung’s Mobile eXperience executive vice president Choi Won-joon expressed that through this cooperative effort, the global growth of offline CBDC technology can be attributed to both parties.
It is noteworthy that Samsung had already added support for third-party cryptocurrency hardware wallets, including the Ledger Nano S and Nano X, to its range of Galaxy smartphones two years ago.
Despite the growing interest in CBDCs, some politicians, specifically in the United States, have voiced strong opposition. A primary concern among individuals like Robert F. Kenney Jr. and Florida Governor Ron DeSantis has been that of user privacy. Just last week, DeSantis signed a bill banning the use of a centralized digital dollar in Florida, while Texas Senator Ted Cruz has claimed that CBDCs are designed to “destroy all the value of Bitcoin.”
On the other hand, Quant CEO, a key infrastructure provider for CBDCs in the United Kingdom, believes privacy concerns may be overstated, assuring that central banks are not interested in citizens’ spending habits and that the same rules of AML and KYC would apply to central bank currencies as they do today for commercial banks.
Source: Decrypt
