KT Corporation, the leading telecom firm in South Korea, will be developing a local cryptocurrency. This is after the firm signed an agreement with Gimpo city. Earlier, Gimpo city had announced that it needs a local money platform operating agency where KT Corporation became the preferred bidder.

According to reports by ZDNet, a local news outlet:

KT was selected as a preferred bidder for the successful settlement of Gimpo city currency by proposing a block currency local currency platform that can block illegal circulation and mobile and card payment. The local currency platform proposed by KT to Gimpo city is based on a blockchain based encryption token technology K-token.

The local cryptocurrency will undergo a test phase in March and be formally introduced a month later in April. During its initial stages, the local cryptocurrency will be restricted to be spent at merchants within the city. Paying using the crypto will be facilitated by scanning a QR code.

After payment, the merchant may choose to retain the crypto or exchange it to its fiat equivalent through their bank account. The conversion will not be charged.

By embracing a blockchain-based currency, Gimpo city will be able to eradicate the production of fake fiat currencies. Also, a blockchain-based system will provide the city with:

Basis data for the establishment of various policies and the feasibility study of Gimpo city through analysis of big data such as general issuance, policy, allowance, industry type, and usage by each merchant.

11 billion Korean won worth of the local cryptocurrency will be released each year and will include budgets for youth subsidies among other projects.

KT Corporation has indicated that it will be pitching the local cryptocurrency idea to other interested cities.

Do you think the Gimpo city local cryptocurrency will act as a test project on whether South Korea can embrace a government-backed digital currency?

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