This month, Samsung announced its participation in a Bank of Korea project which aimed to develop a platform for a CBDC. The pilot will “research the practicalities of the CBDC in a test environment” according to an executive quoted by The Korea Times. The Bank of Korea is particularly interested in use studies of a central bank digital currency in terms of international remittances and the technical components involved in a potential launch. For its part, Samsung is aiming to test the blockchain-based systems on its suite of Galaxy smartphones.
“We have another country downplaying cryptocurrencies, while still keeping the door open to a CBDC revolution. And, while they may not call it a revolution, CBDCs will, indeed, be revolutionary for our financial system. With the BOK moving forward to study this and involving one of the largest smartphone producers on the planet, this is going to be one of the more important studies to follow,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.
“Samsung’s involvement is critical beyond how they will participate in this particular test. Samsung is a premier provider of smartphone technology. That they want to see how their technology works in conjunction with a CBDC indicates that the company sees seismic shift coming,” Gardner opined.
“Will it be possible to conduct payments via mobile phones using the digital currency with no internet availability, or to send CBDC remittances to other mobile phones or to other connected bank accounts, are the two core points that Samsung is looking at,” according to a company official.
“We’re at a point where stablecoins have gained traction, and central banks are beginning to see urgency in rolling out their own digital currencies. While some governments are under more pressure than others, it is clear that there is demand for a digital currency. Without a CBDC, stablecoins are setting themselves up to fill that market need. The time for central banks to begin moving on this innovation is here, and it has been here for quite some time,” said Gardner.
Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.
“Beyond just putting out a technology which is competitive to stablecoins and cryptocurrencies, there is significant upside to CBDCs. For example, they will lessen the burden of cross-border payments. They’re also likely to decrease the costs associated with banking. This could open up significant new access points to the currently unbanked populations. It isn’t a stretch to say that, for some segments of the population, CBDCs could be a life-altering innovation,” opined Gardner.