The Bank for International Settlements (BIS) reported that more than 30 potential CBDC applications have been assessed as part of a joint project by international central banks.
It was BIS London Innovation Centre that joined forces with the Bank of England to explore how digital retail payments could be improved by bringing these financial regulators together with the private sector.
As part of this experiment, 33 application programming interface (API) features were developed to evaluate all of these possible uses of CBDC.
Interestingly, legislation is currently being drafted in the US to prevent CBDC issuance.
The Bank of England is currently consulting on the introduction of a digital pound sterling, which will be required in the near future. The consultation has indicated that there will be a centralised system and API for this digital pound. This API will allow private companies to access the ledger and offer services such as automated payments.
The trial looked at multiple payment systems, including online, offline and point-of-sale by linking to QR codes, phones, smart cards, etc.
In April, Bis published a study on the Meridian initiative, a collaboration with the Bank of England that piloted distributed ledger technology for interbank transactions.
Furthermore, blockchain network Quant said it will participate in the Rosalind project as part of the supplier team. Quant will provide the underlying blockchain structure and platform, secure smart contracts and interoperability with the central bank registry, while UST is responsible for the external interface of the Rosalind API.
The Bank for International Settlements is trying to get involved in CBDC research. Several countries have already started issuing CBDCs and some others are about to do so soon, such as Thailand.
Nevertheless, CBDCs are still viewed with suspicion in the US, and some states, such as Florida, have already banned them legally.
G7 countries have also shown interest in CBDCs, exploring ways to help developing countries launch their own digital currencies. However, the potential risks associated with this technology need to be considered before further progress can be made.
