The Korean central bank is developing a blockchain platform for government bonds, Yonhap news reports. Many other blockchain bond solutions focus on the issuance process. But in this case, the objective is to test real-time settlement or delivery versus payment.
To achieve this, the records for the Korea Securities Depository uses a distributed ledger. This enables the transfer of ownership title to happen simultaneously with payment. Nodes are hosted by the central bank, the KFTC (responsible for Korea’s payment network) and other financial institutions.
However, apart from registering ownership of the bonds, the payment leg implies cash on the ledger. So the question is whether the Bank of Korea is enabling a wholesale central bank digital currency (CBDC) or the cash is private money.
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