In an announcement today, South Korea’s Financial Services Commission (FSC) – the country’s primary financial regulatory and authority – has revealed its plan to launch a blockchain-powered pilot project for financial services this year.

While details are scarce, a report by local publication Korea Herald points to implementing blockchain technology as the core infrastructure for a sweeping financial services platform.

The announcement comes just over a month after the formation of South Korea’s first blockchain consortium. A group of 21 financial investment companies and five blockchain technology firms signed a memorandum-of-understanding to develop distributed ledger solutions as a think tank for the Korean capital market.

The government-civilian consortium has been spearheaded by authorities like the FSC and the Korea Financial Investment Association. “It plans to embark on a pilot project in earnest this year,” stated FSC vice chairman Jeong Eun-bo.

The working group is a part of a wider, marked effort by the South Korean government to promote the country’s Fintech sector. Pledging three trillion won ($2.65 billion) in financial support for industry startups and companies, the government is ramping up its technology-forward initiative to establish the country as a Fintech hub in Asia. The eastern Asian nation is competing against the likes of Singapore and China in the region, two countries that make for the leading pack for blockchain development and adoption.

According to the paper, Jeong sees the “blockchain revolution” equivalent to the “internet revolution” in the 1990s.

In quotes reported by the publication, he added:

Blockchain technology has great potential to be used in finance and various other fields. Since South Korea has the world’s top-level ICT (Information and Communications Tech) , it will be able to lead the international trend in the blockchain sector if the government, related industries and experts pool their wisdom.

Bitcoin Regulation to Follow

The sweeping Fintech drive will also see South Korea introduce bitcoin regulation in 2017. A digital currency task force was set up by the FSC in late 2016 to focus on regulatory and licensing parameters for bitcoin exchanges in a country that is seeing increasing adoption of bitcoin.

“The government will push for the systemization of digital currency on a full scale in tandem with a global trend in the U.S., Japan and other countries,” FSC chairman Yim Jong-yong said at the time about the regulatory effort.

To push the bitcoin and blockchain narrative further, the Shinhan Bank =-one of South Korea’s largest financial institutions – has already initiated a remittance service in the South Korea-China corridor, backed by bitcoin.  Meanwhile, the Korea Exchange (KRX), South Korea’s securities exchange operator has also launched a blockchain-powered trading platform, similar to Nasdaq’s Link, that allows startups to trade equity shares on the open market.

Images from Shutterstock.

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