The Bank of Korea is preparing to launch a second phase of testing for its central bank digital currency (CBDC), as reported on December 21. The central bank has communicated with major banks about this new round of testing, which aims to explore the distribution of government subsidies via digital currency. This initiative seeks to enhance the efficiency of subsidy distribution by reducing administrative costs and limiting the use of funds. Previously, the Bank of Korea conducted a three-month CBDC pilot program starting in April, involving seven banks. However, the project was halted due to criticisms over its limited practical benefits and the significant financial burden it placed on participating banks. Details regarding the methods and timeline for the upcoming testing phase are still under discussion.