Central banks of China and UAE join digital currency project for cross-border payments

The Bank for International Settlements (BIS) announced that the Digital Currency Institute of the People’s Bank of China and the Central Bank of the United Arab Emirates are joining the Multiple CBDC (m-CBDC) Bridge, a cross-border payments project.

m-CBDC is a co-creation initiative run in partnership with the BIS Innovation Hub, the Hong Kong Monetary Authority and the Bank of Thailand. The project aims to develop a proof-of-concept prototype to facilitate real-time cross-border foreign exchange payments on distributed ledger technology and propose solutions and concepts to alleviate the current pain points in making cross-border fund transfers. These include inefficiencies, high cost and complex regulatory compliance.

It will further explore the capabilities of distributed ledger technologies (DLT) by developing a proof-of-concept (PoC) prototype to support real-time cross-border foreign exchange payment-versus-payment transactions in multiple jurisdictions, operating 24/7. It will analyze business use cases in a cross-border context with both domestic and foreign currencies.

The m-CBDC Bridge project will foster a conducive environment for more central banks in Asia as well as other regions to jointly study the potential of distributed ledger technologies (DLT) in enhancing the financial infrastructure for cross-border payments.

Source

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