Top News 4U
Stock Market, Currency and Financial News

BIS releases full report on mBridge Enterprise Central Bank Digital Currency Platform after successful beta

0 0

The Bank for International Settlements (BIS) launched its third publication in a matter of days detailing how commercial banks in four jurisdictions are transferring money using central bank digital currency.

The Bank for International Settlements (BIS) has released the full details of its mBridge pilot project to use Central Bank Digital Currencies (CBDCs) for foreign exchange. Commercial banks in four jurisdictions made cross-border transfers using central bank digital currencies and distributed ledger technology (Blockchain) in the project, which was announced as a success.

Twenty commercial banks in Hong Kong, China, the United Arab Emirates and Thailand used the custom-built mBridge Ledger platform and their central bank digital currencies to conduct payment and foreign exchange transactions on behalf of their corporate clients between August 15 and September 23. More than $12 million has been issued on the platform, facilitating over 160 deals worth more than $22 million.

The mBridge Ledger platform used a single platform direct access infrastructure to conduct real-time peer-to-peer transactions using the HotStuff+ consensus mechanism. The Dashing consensus protocol is also being tested.

The project highlighted a number of policy challenges. According to the authors, the legal classification of the central bank digital currency is the most pressing issue. Where they wrote:

“The usual question is whether the central bank currencies on the platform will be classified as a currency, a representation of money on account with the central bank, debt or something else.”

The new technology has raised even more fundamental issues:

“Expanding access to central bank funds directly to foreign participants and transacting on a common ledger requires further exploration of policy, data privacy, and governance considerations.”

Practical matters that will be covered in 2023 and 2024 include integrating liquidity management and foreign exchange rate discovery.

You might also like
Leave a comment

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More