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Asian And Middle East Central Banks Claim Success With Digital Currency Pilot

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A project to test Central Bank Digital Currencies (CBDCs) in four jurisdictions in Asia and the Middle East shows that cross-border payments can be made faster and more efficiently, according to the central banks involved.

The pilot scheme, known as Project mBridge, involved central banks and commercial financial institutions from China, Hong Kong, Thailand and the United Arab Emirates (UAE). In the six weeks from August 15th to September 23rd, the system was used by 20 banks in his four markets, processing over 160 payments and foreign exchange transactions totaling approximately $22 million. I was.

and report According to a report published Oct. 26, the pilot said that “a common multi-CBDC platform would improve the speed and efficiency of cross-border payments, reduce settlement risk, and encourage the use of local currencies in international payments.” We have confirmed that we can support it,” he said.

The Hong Kong Monetary Authority described the project as “the largest cross-border CBDC pilot to date” and is one of the first multi-CBDC projects to settle cross-border transactions of real value on behalf of businesses.

CBDC is different from well-known cryptocurrencies such as Bitcoin and Ethereum.
as they are issued by states rather than private institutions and their value should not move beyond the country’s conventional currency. to enable international commerce by providing a system that is efficient and inexpensive.

The pilot project appears to have achieved at least some of these objectives, with the Bank of Thailand saying it has reduced cross-border remittance times from three to five days to just a few seconds.

The central bank of the United Arab Emirates said this week that the project “has demonstrated faster, cost-effective and secure cross-border currency settlements,” adding that it “will build an efficient, compliant and scalable border.” We offer payment solutions that transcend…operating in a variety of jurisdictions and currencies.”

Further development of the mBridge platform is currently planned to, among other things, improve interoperability with domestic payment systems, integrate liquidity management tools and better foreign exchange functionality.

Other countries may still be invited to participate. Howard Lee, Deputy Commissioner of the Hong Kong Monetary Authority, said the results of the pilot will encourage other central banks to join mBridge as observers or participants to maximize network effects and realize the full potential of the project. He said he hopes to support that.

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