The People’s Bank of China (PBOC) is teaming up with its counterparts in a slew of other jurisdictions to work together on research into central bank digital currencies (BDC’s).
The Digital Currency Research Institute of PBOC has jointly launched the Multilateral Central Bank Digital Currency Bridge (m-CBDC Bridge) with several other central banks, including the Hong Kong Monetary Authority, the Central Bank of Thailand, and the Central Bank of the United Arab Emirates.
According to PBOC the goal of the project is to “explore the application of CBDC’s to cross-border payments,” and is supported by the Hong Kong branch of the Bank for International Settlements (BIS).
“The m-CBDC Bridge will use development of testing prototypes to further research distributed ledger technology (DLT), achieve 24/7 simultaneous settlement of cross-border transactions with paired CBDC, and facilitate the exchange of currencies for cross-border trading purposes,” said PBOC’s Digital Currency Research Institute in a statement issued on 24 February.
“The m-CBDC will enable more central banks in Asia and other regions to jointly research and upgrade the cross-border payments capabilities of their financial infrastructure, in order to resolve problems such as low-efficiency, high costs and low transparency of cross-border payments.
“On the basis of research results, each of the participants will evaluate the feasibility of the application of the m-CBDC to cross-border capital allocation, international trade settlement and foreign exchange transactions.”