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- A reporter called Han Jong-Hwa has confirmed that the Bank of Korea is working on a project related to Blockchain bonds.
- The Blockchain bonds take over, the records would be transferred to a distributed ledger system that would allow multiple nodes to connect and share information.
- The Bank of Korea, the KFTC, and other financial organizations which participate in the transaction become part of a node.
A reporter called Han Jong-Hwa has confirmed that the Bank of Korea is working on a project related to Blockchain bonds. At the moment, the project is under the testing phase.
The Bank of Korea and the financial market of the country revealed that KNHP is looking for a provider to help with the development of Blockchain. The search began during December 2019 and is still going on at the moment.
These bond transactions would be quite different from the current ones. At the moment, the records for bond transactions are maintained and handled by Korea Securities Depository.
However, once the Blockchain bonds take over, the records would be transferred to a distributed ledger system that would allow multiple nodes to connect and share information. This recordkeeping would work on the principle of Blockchain technology and make the process a lot quicker, secure, and reliable.
A distributed ledger system is an excellent method to handle these transactions. In a distributed ledger system, when a transaction is made, the parties performing the transaction record the data related to this transaction in their respective ledgers after coming to an agreement.
The Bank of Korea, the KFTC, and other financial organizations which participate in the transaction become part of a node.
The case study being conducted by the Bank of Korea is similar to that of the World Bank. In 2018, the World Bank and the Commonwealth Bank of Australia collaborated to issue a Blockchain-based bond called Bondeye.
Bondeye is issued on a private Ethereum protocol that restricts participants. It was issued back in August 2018 with a two-year maturity.
Last year, Han invited Mr. Ha Yun-jung to lead the World Bank Treasury. However, it would take a long time before we see that Blockchain-based bonds adopted on a large scale.
One significant difference in the approach of the Bank of Korea and the World Bank is that the Korean bank is performing tests after considering that the bonds have issued already. The test is still in a proof-of-concept stage to enhance its capabilities.
An official said, “We are using government bonds to record securities and cash transactions in a distributed ledger and test whether a real-time simultaneous payment trading system is possible.”
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
