Bank of Korea Conducts Successful CBDC Pilot Test with Financial Institutions

The Department of Science and Technology-Advanced Science and Technology Institute (DOST-ASTI) in the Philippines has launched an initiative to educate the Southeast Asian country’s young people in relation to blockchain technology and non-fungible tokens (NFTs). The DOST published a blog article on its website on September 23 titled “Opening opportunities for the youth: DOST-ASTI highlights blockchain applications across various sectors.” It highlighted that technologies such as blockchain are “key forces reshaping how public and private institutions operate.” It’s on that basis that the government agency believes that there is a need to familiarize the country’s youth with blockchain technology, digital assets and NFTs. Photo by Choong Deng Xiang on UnsplashTech forum With that objective in mind, DOST-ASTI held a tech forum titled  “ASTIg Tech Talks Season 2: Blockchain for Young Innovators” on September 20 in Pasay City to fulfill that objective of aiding Filipino youngsters in becoming better acquainted with blockchain technology. The event formed part of the second National Youth Science, Technology and Innovation Festival (NYSTIF). In that effort, the agency is placing a focus on the real-world applications associated with blockchain technology, and with that, an emphasis on the fostering of this innovation going forward. DOST-ASTI placed blockchain in the same category as other emerging innovations such as the Internet of Things (IoT) and artificial intelligence (AI), pointing out that these are tangible innovations rather than hyped buzzwords. Job opportunities DOST-ASTI Senior Science Research Specialist Roxanne Aviñante spoke at the event, introducing the concept of blockchain to those participating students in attendance. Aviñante outlined that the emerging technology is building momentum and with that, increasingly there are job opportunities opening up within the sector. While acknowledging that blockchain’s first application was cryptocurrency, Aviñante pointed out that other use cases are being found. With that, she referred to “Self-Sovereign Identity Empowerment: Reinventing Rights and Attributes” (SIERRA), a blockchain-based system for managing intellectual property that is being developed by DOST-ASTI. Marc Jerome Tulali, a science research specialist at DOST, discussed the use of blockchain in voting systems and how it addresses deficiencies in traditional voting systems. Tulali claimed that blockchain can enhance traceability and transparency, as it provides a clear flow and record of product movement. Additionally, its characteristics make it ideal in addressing fraud and counterfeiting risks. Tulali recommended participating students to enroll in online educational courses in order to learn more about the field. He also provided details of four sample careers in blockchain, including blockchain developer, blockchain architect, NFT artist and blockchain researcher, as potential job opportunities for the students in the future. The Philippines has featured consistently within the top twenty of nations on Chainalysis’ Global Crypto Adoption Index in recent years. It has long been considered an ideal market for furthering crypto-based payments, given the large Filipino diaspora sending millions of dollars back home from overseas each year. With that remittance market in mind, Australian startup Stables Money recently partnered with Philippines-based digital assets platform Coins.ph to use a Philippine peso-based stablecoin for remittances.

The trading volume of South Korean cryptocurrency exchange Bithumb exceeded that of its competitor Upbit as of 10:30 a.m. UTC on Wednesday, as reported by the local news outlet Etnews, which cited data from CoinMarketCap. This shift occurred for the first time in four years. According to CoinMarketCap, as of the specified time, Bithumb's 24-hour trading volume reached KRW 4.93 trillion (approximately $3.8 billion), surpassing Upbit, which recorded a volume of KRW 4.37 trillion. Until 2019, Bithumb was the leading exchange in Korea. However, it ceded its top position to Upbit, which gained a competitive edge through its collaboration with the internet-only bank, Kbank.Photo by Pierre Borthiry - Peiobty on UnsplashZero trading fees and new crypto listingsEarlier in the year, Bithumb initiated a strategic plan with the objective of boosting its trading volume in order to increase its market share in the domestic market to 25%. To achieve this goal, the exchange implemented several key initiatives. One of the significant steps taken was the elimination of trading fees, aimed at attracting more users and increasing transaction volumes. Additionally, Bithumb broadened its cryptocurrency offerings by listing prominent cryptocurrencies such as Tether (USDT) and WEMIX.Questioned sustainability of strategiesIn anticipation of crypto winter giving way to crypto spring, trading platforms are gearing up for more intense competition to increase their market shares. However, there are concerns about the sustainability of strategies like implementing zero trading fees. Critics argue that such policies, while they may temporarily shift market shares, are unlikely to be successful in the long term. This skepticism is largely due to the fact that cryptocurrency exchanges heavily rely on trading fees as a primary source of revenue.  An industry expert has pointed out that unless the cryptocurrency exchanges currently lagging behind develop innovative, paradigm-shifting strategies capable of significantly impacting the market landscape, there's a high likelihood that the ranking order will revert to the previously established, entrenched market order.  In fact, at the time of this publication, Upbit upended Bithumb in 24-hour trading volume, recording KRW 4.4 trillion compared to Bithumb's KRW 3.2 trillion. This data underscores Upbit's strong position in the market, illustrating its continued dominance.

Singapore’s MAS gears up for live CBDC pilotThe Monetary Authority of Singapore (MAS) has unveiled plans to initiate a live central bank digital currency (CBDC) pilot for wholesale interbank settlement in 2024.Photo by Sergio Sala on UnsplashMoving beyond simulationThis pilot will move beyond simulation, involving the actual utilization of a live wholesale CBDC for settling payments between commercial banks. Furthermore, MAS indicated that upcoming pilots may extend to leveraging wholesale CBDCs for the settlement of cross-border securities trade.MAS Managing Director Ravi Menon expressed the significance of this move, stating:“The ‘live’ issuance of central bank digital money for use as a common settlement asset in payments is a significant milestone in MAS’ digital money journey that began in 2016. The issuance of wholesale CBDC reinforces the role that central bank money plays in facilitating safe and efficient payments.”Orchid BlueprintThis announcement is a key component of the Orchid Blueprint, a comprehensive plan detailing the infrastructure essential for facilitating the pilot and future developments. In addition to the wholesale CBDC initiative, the Orchid Blueprint outlines the expansion of trials to encompass tokenized bank liabilities and regulated stablecoins, solidifying Singapore’s commitment to fostering innovation in the digital finance space.As part of the Orchid Blueprint, MAS is set to create a settlement ledger to record digital money transfers. This ledger will incorporate features like programmability and atomic settlement of digital tokens. To enhance user experience, a “Name Service” for customer-friendly wallet addresses and name identifiers is on the agenda. Additionally, a tokenization bridge will be developed to connect existing account-based settlement systems with ledgers compatible with tokenized forms of digital money.Purpose-bound moneyThe Orchid Blueprint introduces a “programmability protocol” based on the concept of “purpose-bound money” (PBM). PBM, a concept considered by the MAS in a whitepaper that it published earlier this year, allows for the specification of certain conditions for the use of digital money, enabling automation of transactions and predefined conditions for settlement. This innovative approach empowers centralized planners to define the conditions for usage, bringing a new level of flexibility to the digital financial landscape.This development aligns with the broader trend of increasing institutional interest in digital currencies and blockchain technology. The move towards live CBDC pilots, tokenization and stablecoins underscores Singapore’s commitment to staying at the forefront of financial innovation. As the Orchid Blueprint unfolds, it sets the stage for a dynamic and technologically advanced financial ecosystem, reinforcing Singapore’s position as a leader in the global digital finance arena.In a related move within the region, crypto firm Paxos recently announced plans to launch a new USD-backed stablecoin in Singapore, receiving in-principle approval from MAS to issue the stablecoin. Meanwhile, International Monetary Fund (IMF) Managing Director Kristalina Georgieva outlined in a keynote speech at the Singapore FinTech Festival earlier this week that CBDCs not only could replace cash but also improve financial inclusion.These concurrent developments indicate the growing convergence of traditional financial systems with the expanding digital currency landscape.