Sun. Jun 23rd, 2024

The ‘Blockchain protocol’ has been dubbed the Internet 2.0. Why? Because blockchain will have as big an impact as the internet had; in simplifying financial transactions, changing how businesses work, and potentially, how society is structured. Over the last year, South Korea have been actively seeking to influence the blockchain market.

What is blockchain?

Blockchain is a digital ledger in which transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly. A cryptocurrency is generally an encrypted, digital and decentralised currency, it is separate from a ‘centralised bank’. Bitcoin is the original cryptocurrency and the first use of blockchain – blockchain was created to make Bitcoin work. However, blockchains usefulness extends beyond the world of finance. Developers realised that the code beneath Bitcoin can act as a ledger – as it has for Bitcoin. But by allowing information to be distributed but not copied, blockchain has added new slabs on the sharing economy path that society is currently travelling along. This is obviously pretty important and naturally, big business and tech-savvy countries are getting interested.

South Korea Government Drives for Blockchain Progress

South Korea, known for their interventionalist approach when setting the agenda for IT progress, have recently introduced ‘The Bitcoin Regulation Act’. This hopes to begin a regulated market in South Korea of cryptocurrencies. The head of the governments Financial Services Commission said they want to be “spearheading the development of technology and service in the blockchain field” rather than “passively following in the footsteps” of other countries.

Some of the bigger players in South Korea are also cautiously joining the blockchain hype (with encouragement from the government). Samsung SDS (the IT service arm of Samsung) have been quietly working behind the scenes of blockchain for the last few years. From a blockchain powered credit card to releasing their own commercial blockchain services (Nexledger), a lot has happened in a year. Samsung’s government backed blockchain initiative in logistics helped join two major corporations in South Korea when it was backed by Hyundai Merchant Marine, one of the country’s big two shipping heavyweights. Another huge electronics company joining Samsung and Hyundai Merchant Marine is LG. They too have put their IT subsidiary on the blockchain case. In July 2017, they launched their own blockchain backed platform.

South Korea’s efforts so far have been a success.  Sixteen major banks and almost twice as many brokerages have signed up to a government-led blockchain consortium, whose leader has claimed that as South Korea’s IT industry is so advanced, the country “will be able to lead the international trend in the blockchain sector if the government, related industries and experts pool their wisdom.” The utilisation of blockchain in South Korean society is filtering from finance and electronic industries to other key sectors. Kyobo Life has started working with several hospitals on a pilot data sharing project using blockchain code developed by South Korea’s Ministry of Science, ICT and Future Planning. It has been a success and the hospitals in the pilot are looking to join with other hospitals around South Korea in a government-backed, cloud-based information system which would synchronise hospital databases across the country.

Seoul’s Sogang University have already started a pilot scheme, and are looking to allow student to pay school fees, use vending machines and exchange money using the blockchain system.

Blockchain has been taken up by major conglomerates and the government in South Korea and this is a massive plus for the future of the blockchain. However, this doesn’t mean it has been universally accepted across South Korean society. The motor industry, which equates to more than a third of the country’s export economy, has had little or no interest in blockchain so far. Also, whilst Samsung and other major IT giants have taken an interest in blockchain, it has been their subsidiaries testing the blockchain market. With South Korea’s tendency for interventionism in the IT sector, if blockchain does kick-off, we’ll be sure to see blockchain platforms rolled out to more sectors in South Korean society.

Foto CC0 via Unsplash


Leave a Reply

Your email address will not be published. Required fields are marked *

Please enter CoinGecko Free Api Key to get this plugin works.