Shinhan Bank Builds CBDC System with LG CNS Partnership

Shinhan Bank, a South Korean commercial lender, developed a Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term-based pilot platform with its partner LG CNS, the IT arm of conglomerate LG Corporation, for the launch of a central bank digital currency (CBDC).

According to the local news outlet Yonhap, the platform is already in its pilot stage and has created a virtual model of a CBDC issued by the Bank of Korea to test the platform. While the CBDCs will be issued by the central bank, financial institutions like Shinhan Bank will act as intermediaries in the system.

However, it is not clear if the commercial bank and its IT partner are leveraging any existing blockchain or developed the CBDC system on a proprietary infrastructure.

This development came when the South Korean central bank already launched a CBDC pilot program to test the technicalities and legalities of the digital won. However, the monetary regulatory clarified that it does not have any plans to launch the CBDC in the short term.

The local report outlined that Shinhan Bank’s platform will allow individuals and affiliates to use the issued digital currencies for various real-world applications like Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term, remittances and foreign exchange transactions.

Additionally, the CBDC system will divide the issued digital currencies into general funds, which will be held by individuals and government funds that will be kept as an emergency fund for specific uses.

Infrastructure Is Ready before CBDC

While central banks are still studying the launch prospects of digital currencies, private companies are preparing infrastructure to support them. Finance Magnates earlier reported on Ripple’s private ledger that will specifically support CBDCs.

Meanwhile, Shinhan Bank is an early adopter of blockchain and launched a Bitcoin-based remittance service as early as 2016. Furthermore, it is heavily invested in many cryptocurrency companies.