South Korea is making significant investments in blockchain technology, aiming to solidify its position as a leader in innovation in Southeast Asia. In a bold move, the South Korean government is injecting 20 billion won ($14.5 million) to support 14 blockchain projects. The Korea Internet & Security Agency (KISA) and the Korean Ministry of Science and ICT will oversee these initiatives.
The primary project in focus is the exploration of a central bank digital currency (CBDC) and digital vouchers, with the Bank of Korea taking the lead. The central bank had previously tested CBDC waters in 2023, focusing on tokenized deposits and wholesale use cases. The new initiative aims to experiment with digital vouchers to enhance efficiency, ease of settlement, and reduce incidences of fraud.
South Korea’s digital vouchers will revolutionize traditional payment methods by allowing instant payments through smartphones. These vouchers will be utilized across various sectors, including transportation, welfare, education, tourism, and retail, similar to the concept of purpose-bound money. The technology will eliminate the need for laborious settlement processes, benefiting sellers by providing immediate payments without the hassle of batching or reconciliation.
Apart from digital vouchers, South Korea is also investing in digital badges for academic achievements and work experience. The Ministry of Justice is leveraging blockchain technology to streamline document notarization and overall legal processes. Public sector initiatives involve blockchain-based rice purchasing and environmental protection practices, demonstrating the government’s commitment to innovation.
In addition to public sector projects, South Korea is also nurturing private sector initiatives in blockchain development. CP Labs, Berry Wars, and Oasis Business are among the entities exploring utilities related to financial management and environmental sustainability. This balanced approach reflects South Korea’s commitment to fostering a robust ecosystem for emerging technologies, including artificial intelligence (AI) and blockchain.
The government’s investment in AI, amounting to over $7 billion in April, underscores its dedication to remaining at the forefront of technology advancements. President Yoon Suk Yeol emphasized the importance of AI in the semiconductor industry, stressing the significance of the ongoing global competition. Private firms are actively contributing to the advancement of AI by developing their own use cases, aligning with the government’s efforts to boost the local AI landscape.
In conclusion, South Korea’s strategic investments in blockchain technology and AI highlight its commitment to innovation and technological advancement. By supporting a diverse range of projects in both the public and private sectors, South Korea is paving the way for sustainable growth and competitiveness in the digital economy. With a focus on efficiency, security, and innovation, South Korea is poised to maintain its leadership position in the region and drive further advancements in blockchain technology and AI.
