South Korea’s fascination with blockchain and cryptocurrency seemingly grows stronger each day. The country is among the few global powers to have embraced and made regulations for the controlled rise and introduction of digital currencies.
Now, there might be greater plans in the mix, if a recent development, buoyed by Chinese progress in blockchain systems, proves true.
Transition to a “data economy”
Korean ministries believe blockchain technology can help in dealing with massive amounts of data. Data Science was a huge theme of the last decade, leading to increased calls for responsible usage and reporting. Korea thinks blockchain is the solution to such concerns.
A report by local publication ZDNet Korea earlier this week, which ICON founder Min Ho Kim refers to, revealed the South Korean government is set to decide on a 480 billion won ($400 million) fund dedicated entirely to blockchain research and development.
2/ They are convinced that blockchain will be the main technology in the era of data economy. The article points out that there is a growing concern that China is ahead and Korea needs to act now or miss the boat.
— Min (@minhokim) May 13, 2020
The committee has until the end of May 2020 to confirm the massive budget, while deciding on a framework that dictates how funds will be used in the next five years until 2025.
Paper explores blockchain in depth
A research paper called the “’Development of Blockchain Technology for the Data Economy” examined the economic and financial feasibilities of devoting state funds towards a blockchain-based solution, which to date remains somewhat unproven in terms of scaling and data processing.
Two Korean bodies, the ministry of science and ministry of ICT, jointly proposed the paper in November 2019, aiming to secure a transition to the “data economy.” They further cite Korea’s ongoing “data revitalization” plan as a stimulus for allowing blockchain R&D.
The paper notes blockchain platforms, while expensive to build, help bring reliability and transparency to large data sets, which give its standing as an “essential” technology.
In addition, the project expects government backing would increase collaboration between private corporations, startups, and government bodies leading to a strengthening of the local blockchain industry.
The paper states “clear limitations” exist in currently available open-source blockchain platforms, adding:
“If this is improved, Korea can lead the next-generation blockchain technology.”
China’s quiet rise
Interestingly, the report states “concerns of China moving ahead” in the blockchain industry as one of the major catalysts for blockchain adoption. Local experts believe “now is a golden time” for investment and “intensive” research.
ZDNet Korea notes Professor Park Yong-beom of Dankook University believes the country is finding it “difficult to catch up” in fields like artificial intelligence and machine learning, which were adopted early on by countries and private entities.
But blockchain remains an “early technology,” which represents an area that South Korea can “take the lead” in.
Park states China is already commercializing blockchain, while the world grapples with regulatory back-and-forth and delayed lawmaking. He adds:
“China is trying to gain the starting advantage by providing the basic infrastructure to other countries.”
Park presumably refers to China’s Blockchain Service Network (BSN), a unified framework that includes collaborative tools for developers to build blockchain solutions and export solutions to other countries.
Cover Photo by Robson Hatsukami Morgan on Unsplash