Korean company KT has partnered with the city of Gimpo to create a community cryptocurrency. KT, which began developments into cryptocurrency three years ago, made this announcement on the 17th of September.
The platform for this service will apparently be up and running by the end of this year and $9 million worth of cryptocurrency will be issued to residents of the community. There are plans to provide this same service to over 25 other communities in the coming months.
Serving the Community
The idea behind a single community having its own cryptocurrency and platform is that it ensures that there will no outflow to other parts of the country.
This means that whatever development is made through the platform is solely for the benefit of the citizens of that region. It also means that transactions are easier to track and prevent fraud.
Local budgets will also become more simplified and straightforward.
“Offline community currencies have been issued for people’s welfare and regional economies, but some local residents have exchanged them with cash or misused them for liquor purchase and so on, causing taxpayers’ money to be hidden in the underground economy,” said a lawmaker, adding, “Online community currencies, however, can be managed in a transparent way in terms of distribution and payment.”
Ease of Use
Another benefit to this technology is that it will be made very easy to use as it will be stored on mobile phones and can be used at any given time.
It will also be convertible and can be exchanged for fiat currency. However, conversions will only be allowed for individuals and businesses within Gimpo.
People before Profit
KT has stated that the purpose of this new currency is to aid the people rather than make profits.
Hence, the fees charged for transactions using the currency will be very low.
This service will not be limited to the people of Gimpo either. There are plans to introduce this currency to over 25 other regions in Korea as well as abroad
A Smaller World?
While this new development could mean many benefits for the people of Gimpo, it seems to run parallel with the purpose of cryptocurrencies in the first place.
One of the biggest appeals of cryptocurrencies is that they are to be a global currency with worldwide acceptability.
Having different regions have their own unique currency only used by them (the way fiat currency works) seems to almost defeat the purpose of cryptocurrency.