© Reuters
Investing.com – The Central Bank of the United Arab Emirates (CBUAE) has successfully completed the largest pilot project to integrate a central bank digital currency (CBDC). Along with 20 commercial banks, the mBridge project involved the Hong Kong Monetary Authority, the Bank of Thailand, the People’s Bank of China Digital Currency Institute, and the Bank for International Settlements.
During the pilot phase, commercial banks processed more than 160 transactions in six weeks, with a volume of US$22 million. The ability to develop an innovative payment system capable of supporting the diversity and growth of the financial sector has thus been demonstrated.
The use of central bank digital currency not only makes cross-border payments safer and faster, but also significantly reduces costs, which should benefit international trade in the first place. CBUAE Governor Khaled Mohamed Balama said:
“The mBridge exemplifies the UAE’s vision to play a leading role in the development and issuance of CBDCs and to become the preferred regional hub for advanced financial infrastructure. At the same time, the CBUAE is expected to be among the world’s leading central banks.
The project is in line with CBUAE’s approach to supporting the competitiveness, diversity and growth of the UAE financial sector in line with upcoming economic trends. We will continue to put in place the appropriate regulatory framework for interoperable CBDCs to deliver tangible benefits to Emirati businesses and consumers.”
By Marco Oehrl