The Bank of Korea — the country’s central bank — signed a memorandum of understanding with Samsung on May 15 to collaborate on offline central bank digital currency (CBDC) research, according to a press release.
Last year, Samsung participated in the second stage of the ‘CBDC simulation study’ conducted by the Bank of Korea. As part of the study, Samsung developed an offline CBDC payment technology whereby devices can use near-field communication (NFC) to route payments and remittances. In other words, the technology allows individuals to make and receive CBDC payments without an internet connection.
With the latest collaboration, the Bank of Korea plans to use Samsung’s Galaxy smartphones and watches to enable offline CBDC payments. This would minimize concerns about the security of offline payments since Samsung devices have a Secure Element (eSE) chipset installed, the press release noted. This chipset has acquired EAL (Evaluation Assurance Level) 6+ grade hardware certification in the security international common evaluation standard CC (Common Criteria), as per Samsung.
Samsung and the Korean central bank will also continue research around stable payment systems that can work even in natural disaster situations when there is no internet connectivity.
Lee Seung-heon, Vice President of the Bank of Korea, said, “It is very meaningful that we developed offline CBDC technology for the first time as a central bank together with Samsung Electronics[…] I look forward to getting out.”
Choi Won-joon, Vice President of Development of Samsung Electronics’ MX Business Division, said:
“Through collaboration with the Bank of Korea, we were able to apply Samsung Electronics’ high-level security technology to the digital currency field. We expect to be able to make a great contribution to the development of CBDC technology.”
The latest development comes after Bank of Korea governor Rhee Chang-yong said in December 2022 that he has become skeptical about the benefits of CBDCs in light of the crypto market turmoil last year.
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